Axis Bank said it is exploring a long-term strategic partnership with Max Life. The country's fourth-largest private sector bank said on Thursday it signed a confidentiality and exclusivity arrangement to explore the possibility of such a partnership with Max Life.
Axis Bank and Max Life are decade-old bancassurance partners and have generated new premium to the tune of ₹12,000 crore during this period. Amitabh Chaudhry, MD and CEO, Axis Bank said the successful completion of the proposed transaction is expected to create significant value for all stakeholders.
“We constantly keep assessing various strategic opportunities and we see a potential for greater participation in the under-penetrated life insurance space. We have had a long-standing bancassurance relationship with Max Life and the on-going discussions are a step further to deepen and strengthen this strategic partnership,” Chaudhry added.
Max Life Insurance is the largest non-bank owned private life insurance company. Max Financial Services owns 72.5% stake in Max Life, Mitsui Sumitomo Insurance holds 25.5% stake, and Axis Bank owns a 2% stake in the insurance firm.
“The strategic interest of Axis Bank in Max Life will lead to the much-awaited permanence and allow both companies to work towards an enduring future for policyholders and other stakeholders. We also believe that the potential transaction will provide a fillip to the life insurance sector overall,” Analjit Singh, founder and chairman, Max Group, said.
The Economic Times reported earlier in the day that Axis Bank is in talks to acquire more than 20% stake in Max Life Insurance through fresh issue of equity.
Axis Bank shares close up 0.37% at ₹743.95 apiece on the BSE Sensex on Thursday, while Max Financial Services jumped 9.41% to close at ₹565.05.