The Insurance Regulatory and Development Authority (IRDA) approved the 30% stake purchase by Punjab National Bank in MetLife India Insurance.
"The Board approved the proposal for inducting Punjab National Bank as a shareholder subject to certain conditions inter alia on appointment of Directors on the Board of the insurer by Punjab National Bank," said IRDA in a statement. The regulator added that the conditions also included reduction in the equity stake by some of the existing shareholder and maintaining solvency margin as per the directions suggested by IRDA.
MetLife is a joint venture between Jammu & Kashmir Bank, M Pallonji Group, the US-based MetLife International and some private investors. MetLife International holds 26% stake — the maximum foreign direct investment allowed in the insurance sector — and Indian shareholders own the remaining 74%.
Further, the board also considered broadening the definition of ‘Indian Promoter’ as defined under the IRDA (Registration of Indian Insurance Companies) Regulations, 2000 to include a Limited Liability Partnership. It approved an amendment to the Regulations to include a Limited Liability Partnership (LLP) firm as an Indian promoter under Clause 2(g) of the IRDA (Registration of Indian Insurance Companies) Regulations, 2000. "Such an LLP can, however, neither be a foreign LLP nor should any of the partners in the LLP be foreign entities," said the insurance regulator.