

Ltd, an associate of the bank, at an appropriate time depending upon market conditions and available options,'' PNB said in a regulatory filing. ''The bank intends to divest its stake in Canara HSBC OBC Life Insurance Co. The city-headquartered state-owned bank had acquired a stake in the life insurer post amalgamation of the erstwhile Oriental Bank of Commerce (OBC) into itself last fiscal year. Punjab National Bank (PNB) will divest its stake in Canara HSBC OBC Life Insurance Co, the lender said on Saturday. The only feasible option might be to transfer the operations to New India Assurance.PTI | New Delhi | Updated: 29-05-2021 21:45 IST | Created: 29-05-2021 21:31 IST PNB, however, has not disclosed how much stake it will dilute in Canara HSBC OBC Life Insurance. A merged entity too would not be financially strong. Senior officials in the industry feel that, given the state of finances and liabilities, it is unlikely that the government would be able to privatise any company. The companies can continue doing business because of government ownership. All three companies have seen their solvency ratios - the insurance industry equivalent of capital adequacy ratio for banks - shrink below the mandated level. Meanwhile, with their finances in a precarious position, the three non-life companies have been shutting offices to cut costs. But in the Budget speech for FY22, finance minister Nirmala Sitharaman said that the government would move ahead with the privatisation of two public sector banks and one general insurance company in FY22.

However, following the outbreak of the Covid pandemic, the merger process was put on hold. In January 2020, the boards of the three non-life companies had approved a proposal to merge. “Liberty is with the respondent No.1 to make selection and appointments of general manager/directors in accordance with law,” the order said. Earlier this month, the Delhi HC, in response to a writ petition filed by National Insurance general manager Ravi, said that appointments made pursuant to that of directors challenged in the writ petition are liable to be set aside. The bureau had also recommended Siddharth Mohanty, Mini Ipe and B C Patnaik as MDs in Life Insurance Corporation. Earlier, Anjan Dey was chosen to head the Oriental Insurance Company. In addition to appointing general managers and directors, the BBB had recommended the names of Inderjeet Singh and Suchita Gupta for the position of chairman and MD position at United India Insurance and National Insurance respectively this year.
