The Hindu Business Line : Allahabad Bank to finalise foreign partner for insurance venture soon

ALLAHABAD Bank expects to decide on which foreign partner to join hands with for its non-life insurance venture in a month, the bank's Chairman and Managing Director, Mr O.N. Singh, told Business Line.

He said that there had been tremendous overseas interest from insurance companies abroad to join the venture. "Fourteen companies from different parts of the world have expressed their willingness," he said. Mr Singh was here in connection with the inauguration of an "8 a.m. to 8 p.m." branch in the city today.

He said that the Dabur group would pick up 5 per cent stake in the insurance company, while Indian Overseas Bank would have 15 per cent. Karnataka Bank and Bank of Rajasthan would have 10 per cent each and the foreign partner, 26 per cent. The remaining 34 per cent would be held by Allahabad Bank and its subsidiary.

Mr Singh said that Allahabad Bank will have no need to raise capital from the market or by way of Tier-II capital (long-term bonds) with its capital adequacy ratio being at a comfortable level of 13.11 per cent. While the bank had scope to raise about Rs 1,000 crore by way of Tier-II capital, it had no plans to do so.

He also did not think much of the proposed Tier-III capital or `perpetual preference shares' either.

Asked about the proposed offices in China and Hong Kong, Mr Singh said the approvals from the central bank were expected anytime.