Canara Bank has received approval from the Reserve Bank of India to sell its holdings in its life insurance and mutual fund ventures via initial public offers (IPOs).
This will see the bank offload its 13% stake in the Canara Robeco Asset Management Company and a 14.5% interest in the Canara HSBC Life Insurance Company.
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The letter dated 5 December 2024 also outlined that the bank must comply with the government’s exemption and reduce its stake in these entities to 30% by 31 October 2029.
The Canara HSBC Life Insurance Company is a joint venture formed in 2008. It is currently 51% owned by Canara Bank, with HSBC Insurance (Asia-Pacific) holding a 26% stake and Punjab National Bank (PNB) owning the remaining 23%, reported ET LegalWorld.
Canara Bank also holds a 51% stake in the Canara Robeco Asset Management Company, with Japan’s Orix Corporation owning the rest.
Canara Robeco was set up in 1993 and was earlier called Canbank Mutual Fund. It was renamed following Canara Bank’s alliance with Robeco in 2007, which is now a part of Orix.
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By GlobalDataThe board of Canara Bank previously approved the stake sale in March 2024, and PNB had disclosed plans in June 2024 to sell a 10% stake in the life insurance company during its IPO, reported the Business Standard.
In the filing, the bank stated: “Subsequent to this, Bank will initiate the process of IPO and shall keep Exchanges informed about the material developments in this regard duly complying with SEBI LODR regulations.”
