ICICI Bank to cut stake in ICICI Pru Life by 2% to 52%
14th June 2018: ICICI BankNSE -1.26 % will decrease its paling in ICICI Prudential Life Insurance by 2 percent to 52.89 percent as it endeavors to increase capital to win a likely rise in requirements in the section ceased June 2018.
In a remark to the stock exchanges, the bank said ICICI Bank’s board of directors had approved the sale of up to 2.87 crore equity shares representing up to 2 percent of the paid-up equity share capital of ICICI Prudential Life Insurance.ICICI Bank has been under pressure due to increasing NPAs particularly from the sectors associated with the foundation. In the quarter finished March the bank reported a 50 percent drop in net gain due to a visible rise in provisions. Provisions bounced more than two times to Rs 6,625.75 crore from Rs 2,898.22 crore in the same quarter last year principally because the RBI pushed lenders to choose a more powerful NPA identification system.
“ICICI wants the funds for its provisions. Its provision coverage proportion at 48 percent excluding professional write-offs is economical than the average 56 percent for corporate focused banks. This money will help the bank develop provisions in the quarter ended June 2018,” said Ashutosh Mishra, senior analyst at Reliance Securities.It is unclear whether the bank will inaugurate the sale ere the end of the month. Based on ICICI Prudential Life’s market capitalization of Rs 58,893.35 crore at close of dealing on Wednesday, a sale of 2 percent stake in the company will get ICICI Bank Rs 1,178 crore