Punjab National Bank (PNB), the India-based public sector bank, is planning to enter into life insurance space. Accordingly, it has begun the process of exiting from the joint venture with the US-based Principal Financial Group, paving the way for its foray into the life insurance underwriting business – reported Business Standard.
Reportedly, PNB is a partner along with India-based Vijaya bank and Berger paints and holds 30% stake in Principal PNB Advisory. However, an exclusivity clause has restricted it from pursuing any kind of life insurance activity, either underwriting or distribution. As a result, while several large banks, including some overseas players, have entered into the insurance business, PNB was one of the notable player missing from the sector.
A senior bank executive told the newspaper that “we plan to enter the life insurance sector with a foreign partner, which is only possible after we buy out other partners’ stakes Principal has agreed to sell its stake, while Vijaya Bank is also keen to exit the venture. We hope to complete the process of buying stakes by the end of the current financial year.
