Page 10 - Insurance Times April 2019

LIC of India

News

LIC offers home loans till LIC slashes 2.18% stake in Welspun
LIC has brought down its stake in Welspun Corporation to 5.54 percent by sell-
75 years of age ing shares in the open market. According to a regula-
LIC Housing Finance has tied up with tory filing by Welspun Corp, LIC which held 2,04,82,544
India Mort- shares, or 7.72 percent, sold 57,89,140 shares or 2.18
gage Guaran- stake in the company. Post the open market sale, LIC's
tee Corpora- stake in Welspun reduced to 5.54 per cent or
tion (IMGC) 1,46,93,404 shares, as per the filing.
to provide
home loans LIC, IDBI join hands for bancassurance
that can be repaid up to the age of 75. Life Insurance Corporation tied up with IDBI bank as its bancassurance partner
IMGC will provide insurance against to offer its products through the bank's branches. The bank will also be the
any loan default, the daily said. preferred 'bank' for LIC premium payments. It will also function as premium
point for the LIC to increase the sale of its product. Hemant Bhargava, said, "This
The partnership with IMGC will en-
will enable the bank to add to its revenue growth and simultaneously help LIC
able the mortgage lender to provide
long-term loans to borrowers who in increasing its bancassurance business". The bank with its customer base of
are not salaried. "It will also enable 1.8 crore and over 1800 branches across the country will provide all the insur-
ance product of LIC.
us to provide mortgages with higher
loan-to-value ratios," said LICHFL IDBI Bank, LIC plans future roadmap
MD & CEO Vinay Sah.
IDBI Bank and LIC have constituted a joint task force to chart out a roadmap,
IMGC will secure repayment of 20%
both for the bank as also its associate companies,
of the outstanding loan for a small even as the bank is considering extending the ap-
premium ranging between 0.9% to pointment of Rakesh Sharma, Managing Director and
1.5% of the loan amount, which will Chief Executive Officer, for three years. The major
have to be borne by the borrower areas of synergy for the short-term pertain to sell-
and will be adjusted in EMI. This in- ing LIC policies through IDBI Bank branches, manage-
surance will be enough to cover six ment of cash and other premium receipts of LIC through the bank's branches.
EMIs, which is enough for the lender
to realise value without losing any The statement elaborated that the long-term strategy includes common invest-
money in case of a default by the ment strategy, use of other resources such as real estate, commercial and resi-
dential space, IDBI Bank branches, premises and ATMs, digital marketing,
borrower, the publication mentioned.
rationalisation of the common subsidiaries in mutual funds, life insurance, etc.
With this new product, LIC will be
With this strategic alliance, the bank said it stands to gain immensely as it will
able to increase its market penetra- be able to augment its retail business, thereby de-risking its business portfolio
tion as it can now cater to more and ensuring a rise in other income/operating profit, net interest margin and a
borrowers and ease restrictions on substantial increase in CASA (current account, savings account). The bank has
the profile of applicants, who face already recorded noticeable improvements in the CASA ratio to 38 per cent (of
rejections related to work profile.
total deposits) as on December 31, 2018.
10 The Insurance Times, April 2019