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Business News/ Market / Stock-market-news/  ICICI Bank to sell 2% stake in ICICI Prudential Life
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ICICI Bank to sell 2% stake in ICICI Prudential Life

ICICI Bank says the stake sale can be through any manner including offer for sale by promoters through stock exchange mechanism

While ICICI Bank held 54.88% stake in the JV, Prudential’s stake was at 25.83% as on 31 March, 2018. Photo: Hemant Mishra/MintPremium
While ICICI Bank held 54.88% stake in the JV, Prudential’s stake was at 25.83% as on 31 March, 2018. Photo: Hemant Mishra/Mint

Mumbai: Private sector lender ICICI Bank Wednesday said it will sell up to 2% stake in its life insurance subsidiary ICICI Prudential Life Insurance Ltd. The sale, likely in one or more tranches, will help the bank raise 1,180 crore.

“The board of directors of the bank today approved the sale of up to 28,711,100 shares, representing up to 2% of the issued and the paid-up equity share capital of ICICI Prudential Life Insurance Co. Ltd," ICICI Bank informed stock exchanges.

The bank said the stake sale can happen through any manner, including offer for sale through the stock exchange mechanism.

ICICI Prudential Life Insurance is a joint venture of ICICI Bank and US-based Prudential Corp. Holdings Ltd.

While ICICI Bank holds 54.88% stake in the insurance company, Prudential holds 25.83% as per the latest data on BSE.

ICICI Prudential became a publicly listed firm in September 2016, when it was valued at 47,955 crore.

Analysts believe the share sale will enable ICICI Bank to boost its provision coverage ratio (PCR), which is the lowest among large banks. PCR is the proportion of funds that a bank sets aside against bad loans.

ICICI Bank’s PCR excluding technical write-offs stands at 48.4%, compared to Axis Bank’s 52.5% and SBI’s 50.4%. Among the large banks, Bank of Baroda has the highest PCR excluding write-offs at 59%.

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ABOUT THE AUTHOR
Gopika Gopakumar
Gopika is a Senior Assistant editor based in Mumbai, covering banks, shadow banks and Reserve Bank of India for the last seventeen years. She started her career as a Television journalist with CNBC-TV18, before joining Mint. Her expertise lies in breaking exclusive stories.
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Published: 13 Jun 2018, 06:18 PM IST
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