Dutch firm Robeco to buy 49% in Canbank MF

Dutch asset manager Robeco Groep NV, a part of European banking giant Rabobank Groep, will buy 49% stake in Canara Bank’s asset management arm to gain a foothold in the Indian mutual fund industry.

Robeco has assets under management of €139 bn worldwide and posted operating profits of €233 mn in 2005. It will pay Rs. 115 crores to Canara Bank for its stake in Canbank Investment Management Services Limited (CIMS).

Reserve Bank has given its assent to the proposed venture, and approval from market regulator SEBI and Foreign Investment Promotion Board would be sought soon.

In all, India has 32 mutual fund players with total AUMs of more than Rs. 350,000 crores. Canbank is a relatively smaller player with AUMs of about Rs. 2200 crores.

The asset management company, to be called Canara Robeco, would aim to capture 5% market share in the next five years. The JV would float five new products, especially equity-based, in the coming months.

Read The Economic Times article.

HSBC forms life insurance JV with Canara Bank and Oriental Bank of Commerce

British banking giant HSBC has formed a life insurance JV with Bangalore-based Canara Bank and New Delhi-based Oriental Bank of Commerce.

Canara Bank will hold 51% stake in the venture with HSBC taking 26% and Oriental Bank of Commerce settling with 23%. The business has been capitalized with a corpus of Rs. 2 bn ($44.97 mn).

HSBC joins a league of global firms such as New York Life, Prudential and Allianz in setting up an insurance venture in India which has a population of 1.1 bn people, and an insurance market that has doubled to more than $20 bn dollars in annual premiums since it was thrown open to foreign investment in 2000.

Read The Economic Times article.