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SBI locks in GE Caps for insurance foray

Our Bureau

MUMBAI, Dec. 5

STATE Bank of India has zeroed in on GE Caps as its partner for the insurance business. Officials said that the bank is expected to make an announcement in this regard shortly.

GE Caps was among the three parties shortlisted by the bank. The other two were Cardiff and Fortis. Bank officials said that GE Caps has been on top of the list consistently as SBI has already a tie-up with GE Caps for its credit card business.

GE Caps will hold 26 per cent stake in the insurance venture while SBI will hold the rest.

SBI plans to distribute insurance products in phases. In the first phase, the bank will distribute its products through 100 branches. ``We are currently identifying the branches on the basis of business handled, level of automation and their geographic l ocations,'' said officials.

In the second phase, a further 500 branches will be rolled out, rising to 1,000 in the third.

SBI plans to sell its insurance products linked to various loan offers. In the deposits category, the bank hopes to write in endowment and money back policies with its saving schemes.

The bank had recently received a certificate of incorporation. The company -- SBI Life Insurance Company Ltd -- has an initial corpus of Rs 250 crore to be fully owned by the bank as of now with 26 per cent stake divested to its partner shortly. The new insurance venture hopes to commence business by the end of this fiscal.

JP Morgan was the insurance consultant of the bank.