Canara Bank To Sell Stake In Life Insurance Arm Via IPO; Raise Rs 8,500 Crore Via Debt
Canara Bank owns 51% stake, while its overseas partner HSBC Insurance (Asia Pacific) Holdings Ltd has a 26% stake.
Canara Bank Ltd. plans to dilute a 14.5% stake in its life insurance venture, Canara HSBC Life Insurance Co., through an initial public offering. The public-sector lender will offload its equity by listing the company on stock exchanges, subject to the approval of the Reserve Bank of India and the Department of Financial Services, an exchange filing said on Friday.
The size of the issue, opportune time and modalities of the issue will be decided in due course, it said.
Canara Bank owns a 51% stake, while its overseas partner HSBC Insurance (Asia Pacific) Holdings Ltd. has a 26% stake. Punjab National Bank Ltd. holds the remaining 23% equity in the life insurer.
The bank also plans to sell 13% of the of the equity shares in Canara Robeco Asset Management Co. by taking the mutual fund subsidiary public. The bank gave in-principle approval to start the process of listing its mutual fund subsidiary by way of an initial share sale in December last year.
Fundraise Plan
Canara Bank also approved the capital raising plan for the financial year 2024–25, amounting to Rs 8,500 crore by way of debt instruments.
This includes raising up to Rs 4,000 crore through Basel III-compliant Additional Tier I Bonds and Rs 4,500 crore through Tier II Bonds, subject to market conditions and necessary approvals.
