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RBI Approves Canara Bank's Plan to Sell Stake in Two Subsidiaries.

Banking & Finance | Dated: 26 Dec 2024

In December 2024, the Reserve Bank of India (RBI) approved Canara Bank's plan to sell part of its shares in two of its subsidiaries: Canara Robeco Asset Management Company (CRAMC) Limited and Canara HSBC Life Insurance Company Limited. Canara Bank, headquartered in Bengaluru, Karnataka, will reduce its stakes in these companies.

🎯 Key Highlights:

  • - In March 2024, Canara Bank's board approved the sale of its stakes in both subsidiaries.
  • - The bank will reduce its stake by 13% in CRAMC and 5% in Canara HSBC Life Insurance through an Initial Public Offer (IPO).

💡 Other Important Facts:

  • (i) The Government of India (GoI) has granted an exemption, requiring the bank to lower its stake in both companies to 30% by October 31, 2029.
  • (ii) Canara HSBC Life Insurance, a joint venture (JV) established in 2008, has Canara Bank holding a 51% stake, HSBC Insurance Holdings Limited holding 26%, and Punjab National Bank (PNB) owning 23%.
  • (iii) CRAMC, originally established in 1993 as Canbank Mutual Fund, became a joint venture with the Robeco Group in 2007. Canara Bank owns 51% of the stake in CRAMC, with Japan’s Orix Corporation holding the remaining 49%.

📚 Test Your Knowledge:

Which bank's plan did the Reserve Bank of India (RBI) recently approve to sell a stake in two subsidiaries?

Correct Answer: Canara Bank

🚀 Quick Recap:

About Canara Bank

  • CEO: K. Satyanarayana Raju
  • Headquarters: Bengaluru