Canara Bank diversifies into Insurance, Venture Capital

Kolkata, Apr 29 (UNI) Canara Bank, one of the largest profit making public sector banks, has decided to foray into Insurance business besides launching a unique Venture Capital fund during its centenary year in 2006.

Announcing this Canara Bank Chairman and Managing Director B N Rao told newsmen here today that the Bank, which had earned the highest ever net profit of Rs 1343.22 crores last year, also planned to raise Rs 3,000 crores from the market in the form of Tier I and Tier II capital before December to part finance a number of forward looking projects this year.

Incidentally, Canara Bank with a network of 2532 branches, including five overseas, is celebrating the Centenary year of its existance with a series of nationwide programmes.

Mr Rao, who has come to the city in connection with the centenary celebration of the Bank, said in order to enter into the Life Insurance business in a big way they had already started fruitful negotiations with a number of prospective foreign partners.

He, however, refused to name any of them saying that within the next one month the right partner would be picked up with about 27 per cent stake in the joint venture.

At present Canara Bank worked merely as the selling agent of Aviva Life Insurance Company, Mr Rao informed.

Referring to his plan for the setting up of the Venture Capital Fund, to be known as the Bharat Nirman Fund, the Canara Bank CMD said with an initial corpus of Rs 100 crores the fund would be formed by a consortium of six public sectors banks under the Chairmanship of Canara Bank.

When established, also in association with Small Industries Development Bank of India (SIDBI), the new fund would cater to the growing needs of the IT, Pharmaceuticals, Services and BPO sectors among others.

Besides Canara Bank, other members of the consortium are Vijaya Bank, Corporation Bank, Indian Overseas Bank, Oriental Bank of Commerce and Allahabad Bank, Mr Rao informed.

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