Canara Bank to list mutual fund, insurance arms early next fiscal

This follows the state-run lender securing government approval to hold more than 30% each in the subsidiaries after their public listings, marking a shift from a prohibitive clause under the Banking Regulation Act.

With the decks now cleared, Canara Robeco Asset Management Company, India’s second oldest asset manager, would launch its IPO in the first quarter of FY26, while insurance subsidiary Canara HSBC Life Insurance is likely to be listed in the second quarter, Raju told ET.

The Department of Financial Services, on the recommendation of the Reserve Bank of India, declared that the provisions of sub-section (2) of Section 19 of the Banking Regulation Act will not apply to Canara Bank in terms of its shareholding exceeding the 30% threshold in the two firms till October 31, 2029 or its revocation, whichever is earlier.

The state-owned lender currently owns 51% of the AMC with Japan’s Orix Corporation holding the remainder. Canara Bank floated the company in 1993, partnering with Robeco, now part of Orix, in 2007. The bank would offload 13% through the IPO while Orix will sell 12%.

The asset management company earned a net profit of Rs 124.8 crore in FY24.In the insurance venture, Canara Bank would sell 14.5% stake of its majority 51% holding. HSBC with a 26% stake would sell only 0.5% to keep the promoter tag that mandates a minimum 25% stake. Punjab National Bank, the other entity in the JV with 23% interest, would sell 10% through the IPO.Canara Bank set up the life insurance company in 2007 in association with HSBC Insurance (Asia Pacific) Holding, and Punjab National Bank.

The insurer clocked a gross premium of Rs 6,933 crore in FY24 and a net profit of Rs 113.3 crore.