India’s largest public sector lender State Bank of India (SBI) is reportedly planning to divest stakes in some of its subsidiaries including SBI General Insurance, to mop up the required capital.
Besides insurance business, the lender is also planning to sell some stakes in its SBI Card and SBI Capital Market businesses over the next two years.
State Bank of India managing director for risk, IT and subsidiaries Dinesh Khara said: “We will look to sell 3-4% stake in the general insurance arm this year.”
He further stated that the bank will list SBI Cards in FY 20.
In 2017, the state-run lender listed its life insurance arm – SBI Life Insurance.
The decision comes as SBI suffered a net loss of INR77.18bn ($1.13bn) in the Jan-March quarter, compared to a net loss of INR34.42bn ($504m) during the same quarter of last fiscal.
SBI General is a joint venture (JV) between SBI and Insurance Australia Group. In the JV, SBI owns 74% stake while the remaining stake is owned by IAG.
SBI managed more than 24,000 branches and 59,000+ ATMs and served over 420 million customers as of 1 April 2017. SBI manages its overseas business through 195 foreign offices spread across 36 countries.