Axis Bank Ventures in the Insurance Sector

Axis Bank Ventures in the Insurance Sector

One of the leading private sector banks, Axis Bank is on the lookout for acquiring an insurance arm. The bank received a green signal from its executive committee back in December for the same. Tata AIA and IDBI Federal Life Insurance are among the possibilities.

Axis bank has a stake of 4.99% with partner Max Life Insurance and has gained substantial exposure to bancassurance and retail franchises. The bank was successful in raising Rs.11,700 crores owing to sales of warrants and shares couple of months back. According to some officials, the acquisition when it happens will do away with equity only.

The promoters of Max were seeking a merger with HDFC Life Insurance to quit life insurance, but the discussions did not take any shape. This acted as a trigger point for Axis bank to consider a move into insurance. They even had initial discussions with IDBI Federal Life Insurance, with Max in the loop.

Venturing into the Insurance sector has proved to be a successful move for some of the leading banks in the country. Three insurance companies, which are bank subsidiaries are valued between Rs.59,100 crores and Rs.87,571 crores after being listed.