News Life and Health02 Jul 2018

India:IRDAI lifts investment ceiling for LIC's acquisition of bank shares

02 Jul 2018

India's insurance regulator has allowed the country's largest state-run insurer Life Insurance Corporation (LIC) to buy a stake of up to 51% in state-owned lender IDBI Bank, reports according to media reports. This represents dispensation for the insurer as rules for insurers cap investments to 15% of the equity of a single entity.

IDBI is one of the 11 troubled lenders identified by the central bank, Reserve Bank, of India under a corrective action plan that includes restricting branch expansion and lending.

The media reports added that the IRDAI board had also allowed LIC to invest between INR100 billion ($1.46 billion)and INR130 billion in IDBI, where its holding was 10.82 % at the end of March. LIC will not have management rights in the bank. It will also reduce its stake in the bank to about 15% over a 5-7 year period.

The purchase by LIC is seen as a bailout of the troubled bank.


 

| Print | Share

CAPTCHA image
Enter the code shown above in the box below.

Note that your comment may be edited or removed in the future, and that your comment may appear alongside the original article on websites other than this one.

 

Recent Comments

There are no comments submitted yet. Do you have an interesting opinion? Then be the first to post a comment.

Other News



Follow Asia Insurance Review