At Rs 83,000 cr, LIC boasts a tenth of ownership in listed banks

Life Insurance Corporation of India (LIC) boasts nearly a tenth of ownership in listed banks in the country. As per data compiled by FE, the insurance giant’s latest cumulative possession in 33 listed banks is more than 9% and valued at close to R83,069 crore, based on Friday’s closing prices.

The latest ownership as of March 2015 is considered for the compilation, barring six for which data were available as of December 2014.

Although market value-wise, SBI continues to be its biggest holding with 11.82% stake valued at R26,029 crore, the insurance player is seen very actively managing its ownership in Axis Bank, its biggest private bank holding.

LIC is not only categorised as a promoter of Axis Bank since December 2013, but has also upped its ownership in from 9.32% to 12.04% as of April 17, 2015. In the last one year, however, it has steadily booked profit by reducing its holding in from 13.62%. ICICI Bank, HDFC Bank and Bank of Baroda are some of its major possessions, collectively valued at R29,644 crore.

For the quarter ended March 2014, some of its biggest purchases in the quarter include UCO Bank, Central Bank and Bank of India in which LIC raised its stake by 7.52%, 3.37% and 2.4%, respectively. These stocks have lost 24%, 35% and 16% of their value in the quarter. Some other public sector banks that crashed 18-35% in the quarter and where LIC increased its ownership increased include Union Bank (stake raised by 1.26%), Canara Bank (0.89%) and Andhra Bank (0.53%).

As such during the fiscal, LIC has more than doubled its stake in United Bank, Punjab and Sind Bank, Central Bank of India and Bank of Maharashtra. The trend may continue if the state-owned insurance behemoth continues to buy into preferential allotments of public sector banks. While in the second half of FY15, LIC infused R626.23 crore into Central Bank of India and R562 crore into Bank of India by buying preferential shares, it is set to purchase about 4 crore preferential shares of Canara Bank at a value of R1,500 crore.