Punjab National Bank acquires 30% stake in MetLife India at an undisclosed amount

NEW DELHI: The country's second-largest bank,Punjab National Bank, has said that it has acquired a 30% stake in the Indian arm of the biggest US life insurer MetLife at an undisclosed amount. ET, in its edition dated May 25, 2011, had reported that PNB was close to buying a significant stake in the private insurer.

The bank also announced a marginal rise of 3.4% in its net profit at Rs 1,105 crore in the first quarter of the current financial year. "The net profit has been impacted due to higher provisioning, decline in treasury income during the quarter," said PNB chairman and managing director KR Kamath.

The bank's net profit in the year-ago period was Rs 1,068 crore. Total provision stood at Rs 1,368 crore. Of this, 566 crore was towards bad debts and Rs 475 crore was towards income tax. PNB's scrip was trading at Rs 1,102.95 on BSE, down 1.96% at the end of the trading session.

Gross NPAs as a proportion of advances went up to 2% against 1.82% at the end of June last year. Net NPAs also rose to 0.86% during the year from 0.66%.

Kamath said the NPA levels were not alarming and the bank has put focus on recovery.

PNB hopes its tie-up withMetLife India will give it the much-needed advantage in the insurance sector. MetLife CEO and MD Rajesh Relan also said the insurer will provide insurance expertise and bancassurance capabilities that will be an asset to PNB. MetLife India will issue fresh equity and later buy stake from the other existing stake holders to keep its stake at 26%.

Source: EconomicTimes