The Hindu Business Line : Bajaj Allianz to increase paid-up equity by Rs 60 cr

Speaking to reporters here on Wednesday, its Chief Executive Officer and Allianz country manager, Mr Sam Ghosh, said, "The capitalisation is required to sustain our growth." Bajaj Allianz's paid-up equity after this round of capitalisation would rise to Rs 368 crore. The last capitalisation was done in August this year.

Mr Ghosh said the capitalisation requirements are on account of the high growth targets fixed by the company. The company had recorded a premium accretion increase by over 300 per cent in October this year. Moreover, he said, the capital requirement would also offset some of the depreciation incurred on some of its investments, particularly government securities,

The joint venture partners, the Bajaj group and the German insurance giant Allianz group, would share the capital contribution. The Indian partner holds 74 per cent equity in the venture.

Bancassurance tie-up: Bajaj Allianz also moved to strengthen its distribution network in the country through bancassurance arrangements with the Syndicate Bank-sponsored regional rural banks. The memorandum of understanding for the purpose was signed here today by the heads of the RRBs.

Mr Kanta Kumar, Chairman and Managing Director of Syndicate Bank, said that the arrangement would double the number of employees selling insurance. Syndicate Bank already has a bancassurance tie-up with Bajaj Allianz Life and has 150 employees selling life insurance products. The bank has so far generated about Rs 100 crore of business for the company and about 30 per cent of BALIC's bancassurance business.

Mr Ghosh said through the RRB bancassurance arrangement, Bajaj Allianz hoped to access the rural markets in the country and sell some structured products at the farm sector. These included both term plans and savings-linked policies. In some of the high-income farm regions, he said, the company would also attempt to sell unit-linked insurance plans.

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