LIC can adhere to 10% stake norm at ‘its own pace'

The Life Insurance Corporation of India need not rush to bring down its current stake in various companies to below 10 per cent. “I advise LIC to bring down the stake to below 10 per cent in a company. But, I don't want to put any timeframe for this. It can do so at its own pace,” Mr J Hari Narayan, Chairman, IRDA, told Business Line here on Wednesday.

As per the current norms of the regulator, no insurance company is allowed to have more than 10 per cent stake in a company. The regulator did not want to pressure LIC to adhere to existing norms by bringing down its stake in various companies in view of the likely adverse impact on market/investors, he added.

However, the state insurer has over 10 per cent stake in many companies, including State Bank of India, MTNL, ITC and Tata Steel.

The issue has come to the fore after LIC had invested Rs 12,000 crore in the auction of ONGC stake by the Government in February.

Mr Hari Narayan, however, said a request by LIC seeking permission to have higher stake than permitted by the norms was turned down.