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Ageas Federal Life Insurance has become the first Indian life insurer to have 74% foreign shareholding following the exit of IDBI Bank which sold its entire 25% stake to Ageas Insurance International NV.
Belgium-based Ageas Insurance International’s stake in the life insurance company is now 74% from the earlier 49%. Federal Bank continues to hold the remaining 26% stake in the insurance joint venture.
As a part of the Union Budget for FY22, the government had increased the permissible limit for foreign direct investment (FDI) in insurance companies to 74% from 49%, thereby accepting a long-standing demand of the industry.
Lukewarm response
However, even then the response has been muted with only a few foreign shareholders such as Italian financial services provider Generali of the Future Generali India Insurance JV, and Ageas Insurance International having increased their stakes so far.
On Wednesday, IDBI Bank had said that it has completed the sale of its entire stake of 20 crore equity shares. The bank is expected to have garnered around ₹580 crore from the sale, as per reports. IDBI Bank has exited the company as a shareholder but continues to be a distribution partner, Ageas Federal Life said in a release on Thursday.
10 consecutive years of profit
“Despite the various challenges due to the pandemic, as well as the prior uncertainty around the stake sale, we have consistently delivered superior results, achieved new milestones, and declared profit for ten consecutive years,” Vighnesh Shahane, MD and CEO of Ageas Federal Life Insurance was quoted as saying.
Founded in 2007, Ageas Federal Life has reported ten consecutive years of profit since FY13. For FY22, total premium of the insurer was up 13% at ₹2,207 crore, with the company declaring a net profit of ₹94 crore.
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