SBI enters general insurance biz through JV with IAG

Mumbai, Nov 24 (PTI) India's largest lender State Bank
of India (SBI) Monday said it has entered into a joint venture
with Insurance Australia Group (IAG) for its foray into the
general insurance business.

State Bank will be holding a 74 percent stake while the
balance 26 percent will be held by IAG, subject to the Reserve
Bank's approval.

Regulatory authorities would be approached for the
necessary approvals and the company hopes to commence business
in the next financial year, SBI said in a statement.

SBI Chairman O P Bhatt said that the joint venture is a
part of the bank's strategic initiatives to retain its
position as the pre-eminent financial services group in the
country.

"Insurance penetration in India is very low and the
general insurance industry is expected to grow at a brisk rate
of 15-20 per cent per annum over a period of next 10-years,"
Bhatt said.

"SBI, with its unparalleled brand equity and extensive
distribution network will be able to provide protection to
people even in the far-flung rural and semi-urban areas
throughout the country and help deepen the market," Bhatt
added.

With this foray, the bouquet of financial products
offered by the SBI Group ensures its footprints in every area
of financial services, the statement said.

The bank is already offering life insurance products
through its subsidiary, SBI Life Insurance Company.

IAG's Managing Director and Chief Executive Officer
Michael Wilkins said that the joint venture was a significant
step in IAG's strategy to pursue select international general
insurance opportunities.

"Entering the Indian general insurance market has been
a priority for IAG for some time, to support our longer-term
growth and profitability," Wilkins said.

One of IAG's key strengths is that it focuses exclusively
on general insurance.

"We are delighted to be partnering with India's premier
financial services organisation, SBI. This provides us with an
exciting opportunity to be a key participant in India's
rapidly-growing general insurance market, by leveraging the
combined strengths of our two organisations," he said.

IAG is an international general insurance group with
operations in Australia, New Zealand, Thailand, Malaysia,
China and the UK through its various brands and its current
businesses underwrite more than Australian Dollars
7.5-billion of premium per annum. PTI JJ
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