Indian private lender Axis Bank on Tuesday signed a non-binding term sheet to invest 499-699 million rupees ($6.12-$8.57 million) for a 9.94 per cent stake in Go Digit Life Insurance.
The development underscores private lenders' growing interest in India's lucrative and largely untapped insurance sector. The country's private lender HDFC Bank also announced plans to buy a 9.94 per cent stake in Go Digit Life last month.
According to Axis Bank, the equity purchase is contingent on the execution of formal agreements, the terms, and conditions of which must be mutually agreed upon. The Insurance Regulatory and Development Authority of India must first award the company a certificate of registration before it may conduct life insurance business in India, it stated.
Axis Bank owns a 12.99 per cent interest in Max Life Insurance along with its two subsidiaries, Axis Capital and Axis Securities.