Mumbai:The State Bank of India today said it has signed an agreement with Insurance Australia Group (IAG) to form a joint venture for entering into general insurance business in the domestic market.
Under the JV agreement, SBI would hold a 74% stake in the new entity that would be set up for providing the business, while the Australian partner would hold the remaining, SBI said in a filing to the Bombay Stock Exchange.
In May this year, both parties had said they would enter into an agreement to form a new company for the proposed insurance business. However, the JV is subject to regulatory approvals, it added.
Last week, the state-run lender had received approval from the Reserve Bank of India for a JV with European financial services group Societe Generale for offering custodial and related services in the country.
Under the agreement SBI would hold 65% equity in the new JV company, while the remaining 35% would be held by Societe Generale Securities Services.
State-run insurers -- United India Insurance, New India Assurance, Oriental Insurance and National Insurance -- are the major players in the general insurance business in the country. However, private sector insurers, including Bajaj Allianz, ICICI Lombard, IFFCO-Tokio General Insurance and Reliance General Insurance, have significantly raised their shares.
Shares of SBI were trading at Rs1,194 on the BSE, up 0.92% in the morning trade.