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Punjab & Sind Bank ties up with Indiabulls; PNB to sell its 23% stake from CHOICE

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Co-lending Punjab & Sind Bank ties up with IndiabullsOn September 14, 2021, Punjab & Sind Bank (PSB) signed a strategic co-lending alliance with Indiabulls Commercial Credit and Indiabulls Housing Finance Limited (IHFL) for MSME (Micro, Small & Medium Enterprises) and Priority Sector Housing Loans respectively.

  • Through this partnership, India’s unserved and underserved sector will be accessed with credit flow at an affordable cost as compared to standalone loans given by NBFCs (Non-Banking Financial Company).
  • This will also help the bank to enhance its Retail and MSME portfolio and boost lending to the MSME sector.

Punjab National Bank begins exit from Canara HSBC OBC Life Insurance

PNB is all set to sell its entire stake (23%) in its Canara HSBC OBC Life Insurance (CHOICE).  In CHOICE, PNB is the promoter after the amalgamation of Oriental Bank of Commerce (OBC) and United Bank of India (UBI) with it in April 2020. Prior to this amalgamation, OBC held a 23% stake in CHOICE.

  • Canara Bank has a 51% stake and HSBC Insurance (Asia Pacific) Holdings has 26% stake in the life insurer, which is now an associate company of PNB.

Reason behind exit:

As per the IRDAI’s (Insurance Regulatory and Development Authority of India) norm, a commercial bank should not hold more than 10% stake in two life insurance ventures at the same time.

  • Post the OBC amalgamation, PNB had significant shareholding in two life insurance ventures viz. PNB MetLife insurance (30%) and the above mentioned CHOICE.
  • In order to keep with the norms, the decision of exit has been taken.

Recent Related News:

Reserve Bank of India (RBI) imposed a monetary penalty of Rs 25 lakh on the state-owned Punjab and Sind Bank for non-compliance with certain provisions related to the directions on ‘Cyber Security Framework in Banks’.

About Punjab and Sind Bank (PSB):

Establishment- 1908
Managing Director & Chief Executive Officer– S. Krishnan
Tagline– Where service is a way of life
Headquarter– New Delhi