RETAIL BANKING | Tony Chua, India

Prudential mulls increasing its 26% stake in ICICI

Indian government seen to allow foreign insurers to raise their stakes.

Prudential Plc, Britain's biggest insurer, hopes that India's upcoming budget will include legislation that allows it to increase its 26 percent stake in its joint venture with the country's No.2 lender ICICI Bank Ltd, which is led by Chanda Kochchar.

Prudential was also confident that it would be able to sustain premium growth in China through its partnership with CITIC Bank, said Barry Stowe, the insurer's Asia chief executive.

The Indian national budget is coming up soon, and there is talk now that foreign insurers may be allowed to raise their stakes, Stowe said during an interview on the sidelines of the World Economic Forum in the northeastern Chinese city of Dalian. We're hopeful that will happen.

Prudential owns just over a quarter of its ICICI-Prudential insurance joint venture with ICICI Bank, the maximum allowed under Indian law. In China, it owns half of the CITIC-Prudential joint venture it runs with CITIC Bank.

The financial sector in Asia may also soon see a shake-up with some foreign companies choosing to exit instead of continuing to bleed, Stowe said.

Lots of foreign companies have come to Asia, but very few have executed well, he said. Some of them are acknowledging their failure and may choose to exit.

View the full story in Indian Express.

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