Axis, Max Life to pursue long-term partnership

MUMBAI: Axis Bank and Max Life Insurance said they will pursue a long-term strategic relationship, but stopped short of confirming an equity investment by the private lender in the insurer. A stake sale to Axis Bank by Max Life has been on the cards for several years. However, the RBI has been wary of lenders committing large capital to businesses that come outside its regulatory ambit.

On Thursday, ET reported Axis Bank was picking a 20% stake in Max Life. The statement on pursuing a strategic partnership was issued by Axis Bank in response to a stock exchange query with respect to the report.

“The ongoing discussions are a step further to deepen and strengthen this strategic partnership. The successful completion of the proposed transaction is expected to create significant value for all stakeholders,” said Axis Bank managing director and CEO Amitabh Chaudhry. He did not elaborate on what the transaction was.

A joint statement said the two had a successful bancassurance arrangement for nearly a decade with Rs 12,000 crore of premium being generated through the tie-up. It added that Axis Bank, Max Financial Services and its subsidiary Max Life have signed a confidentiality and exclusivity arrangement to explore a long-term strategic partnership.

Max Life is currently the largest non-bank-owned private life insurer in India. Max Financial Services holds a 72.5% stake in Max Life, while Mitsui Sumitomo Insurance and Axis Bank hold 25.5% and 2% stake respectively. According to Max Group founder and chairman Analjit Singh, a strategic interest of Axis Bank in Max Life will lead to “the much-awaited permanence”.

Source: The Times of India

http://www.insurancealertss.com//Insurance/NominationForm/17527