Axis Bank to Hike Stake in Max Life Insurance

Private lender, Axis Bank  is slated to hike its stake in Max Life Insurance, its bancassurance partner. The bank currently has about 4% stake in the life insurance company. A senior official from the insurance industry who did not want to be named said, "Axis Bank would be passive shareholders. The move is not aimed at acquiring strategic stake in the insurance venture." Sources said that the bank would be raising its stake by another 4-5% in the insurance company. 
 

Max India on Wednesday informed the BSE that the board the company will meet on October 23 'in order to consider a proposal regarding its existing arrangements with Axis Bank as a shareholder of Max Life Insurance Company' As of now, Axis Bank is bancassurance partner to Max Life Insurance for life insurance while Tata AIG is bancassurance partner for general insurance. Max Life is a joint venture between Max India Ltd. and Mitsui Sumitomo Insurance. Max Life has paid-up capital of Rs. 2115 Crore and Rs. 31973 Crore capital under management. 
 

Insurance sector has become attractive for foreign investors with government permitting foreign direct investment in this sector upto 51%. A number of Indian lenders like State Bank of India and ICICI Bank have an equity tie-up with global insurance companies in life and general insurance with an agreement to exclusively sell their polices to their customers.