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Notwithstanding the recent disclosure by Punjab National Bank that offences of cheating and fraud aggregating about ₹11,300 crore were detected at one of its branches in Mumbai, LIC will keep faith in the state-owned bank by holding on to its shareholding.
After the government’s majority stake of 57.04 per cent, LIC was the second-biggest shareholder in PNB with 13.93 per cent stake as on December-end 2017. In fact, the shareholding of India’s largest life insurance firm in PNB went up from 12.52 per cent in the quarter ending September 2017.
“We are certainly going to hold on to the shares… We stand by PNB… It is a 133-year old bank. It has its own strengths,” said VK Sharma, Chairman, LIC.
Sharma observed that LIC’s equity exposure to the banking sector is 5-6 per cent of its total equity investments. He added that the insurer has more equity holding in private sector banks than public sector banks.
The life insurance behemoth has been an active participant in the QIP offers of PSBs.
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