The general insurance joint venture would have an initial capital of INR1.5 billion
UCO Bank has announced to hold a 30% stake in its planned general insurance foray that is expected to be operational by March 2010 – reported Business Standard.
The shareholders of UCO have accepted the proposal to add to the authorised capital to INR30 billion, from INR15 billion at present. The bank has also received its shareholders’ authorisation for a follow-on public issue, which would bring down the government’s stake to 52%.
As part of capital restructuring in March 2009, the bank received INR4.5 billion, out of INR12 billion from the government as tier I capital. The bank is expected to get the remaining INR7.5 billion by next month through preferential allotment of shares.
S. K. Goel, Chairman and Managing Director, UCO Bank, said: “The general insurance joint venture would have an initial capital of Rs 150 crore. We are in talks with a foreign partner and domestic bank or corporate house for starting the business, and an agreement will be signed by September.”