Page 11 - Insurance Times April 2017 Special Issue on Newindia

Essar to clear all dues before investment LIC's South Central Zone
LIC wants Essar to clear all dues before it gives the green signal to the $13-
billion Essar-Rosneft deal which would be the largest in- exceeds premium target
flow of foreign direct investment in India. Life Insurance Corporation of India
(LIC), South Cen-
The life insurer has said that it would issue a 'no-objec- tral Zone, has
tion certificate' (NOC) only after Essar clears all dues. surpassed its an-
The covenants on LIC's loan to Essar Oil require lender's
nual new busi-
consent for change of management, an LIC spokesman said.
ness premium
LIC's loan outstanding to Essar Oil is $125 million while its exposure to Essar target of Rs
Power is around Rs 1,500 crore. "We had received proposal from group compa- 4,200 crore for
nies for flexible restructuring and it was decided before considering (the) pro- the current financial year.
posal... the company has to clear all the dues (sic)," said the LIC official.
The target was crossed on February
According to an Essar spokesman, "Essar Oil and Essar Power have individually 28, ahead of the end of the financial
availed long-term facilities from LIC. These facilities cannot be linked." year, Zonal Manager TC Suseel
Kumar said. It recorded the highest
LIC to upgrade its agents; PoS transactions soon growth rate of 70 per cent in total
The Life Insurance Corporation of India is working on a significant makeover new business premium income by
that will include an overhaul of its lending operations, selling 21.17 lakh new policies up to
stronger corporate governance framework and a more the end of February.
modern sales force equipped to receive digital payments.
The zone stood at the third position
A standard operating procedure has also been worked at the all-India level in total new
out for repayment through one-time settlement scheme, business premium income.
or OTS. The finance ministry has directed the insurer to give POS machines to
"The zone plans to sell 15 lakh new
its 20 lakh agents for premium collection. To start with, LIC is expected to give policies with a premium income of Rs
the machines to about 2 lakh agents. 1,500 crore during March," Suseel
At the end of March 2016, LIC had a debt portfolio of Rs 3.79 lakh crore, bigger Kumar said in a release.
than the loan portfolios of most banks. Its gross non-performing assets stood at
3.76% at the end of March 2016, up from 3.30% a year earlier. LIC Donates almirahs to

UCO Bank requests LIC again to invest Rs 1K cr in tier- MNPS School
In its 60th year as part of the Dia-
2 bonds mond Jubi-
UCO Bank has asked for help from LIC for the second time requesting to invest lee Celebra-
Rs 1,000 crore in tier-2 bonds of the bank. The in- tion the Life
surer, however, may not be keen to comply as it Insurance
feels size of the investment is too huge. It has res- Corporation
ervations about the paper's rating, too. of India (LIC), Sakchi Branch, donated
A source said that the insurer would be looking to 3 almirahs to Motilal Nehru Public
invest in better-rated papers. However, they have not yet rejected the offer School (MNPS) in Jamshedpur.
outright and may reconsider it if a better proposal comes along. IRDAI has The Principal, Ashu Tiwary said that
permitted insurers to invest in instruments including tier II bonds, but has cau- these almirahs would prove to be of
tioned that they should not invest in lower-rated papers. much help to the school and would

UCO Bank's letter to LIC, submitted to the insurersays, "In accordance with be used for the Examination depart-
Basel III guidelines, our (UCO Bank's) existing tier-2 bonds which are not ment.
Basel III compliant are being discounted at 10 percent every year. Further, some She further stated that in line with
of these bonds are also redeemed on maturity. In view of the same we its motto - "People's money for
propose to raise tier-2 bonds of Rs 1,000 crore. We request you to kindly con- People's Welfare" this organisation
sider for infusing tier-2 capital in the form of debt capital to the tune of Rs 1000 thought of extending support to the
crore." educational constitution.

The Insurance Times, April 2017 11

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