From Financialexpress · Narayanan V · · 1m
PSU Banks See Limited Impact from Irdai Cuts
Public sector banks expect minimal hit from Irdai's insurance commission reforms as private lenders weigh revenue shifts.
In brief
Public sector banks expect minimal hit from Irdai's insurance commission reforms as private lenders weigh revenue shifts. India's public sector banks anticipate small revenue impact from Irdai's insurance distribution reforms while private lenders assess potential revenue changes. Originally reported by…
Irdai's insurance reforms
Irdai released consultation paper proposing insurance distribution economics overhaul.
Canara Bank impact
Canara Bank expects annual hit of ₹120-145 crore to life insurance distribution income.
Canara Bank's overall impact
Canara Bank's distribution business impact estimated at less than ₹200 crore annually.
Canara Bank's profit context
Canara Bank earned ₹19,000 crore in profits last year with ₹457.79 crore from life insurance distribution.
“Taken together, across everything that we distribute, the dent will not be more than Rs 200 crore in any case. Considering the size of our profits, which was ₹19,000 crore last year”
Indian Bank's stance
Indian Bank expects minimal impact on its bancassurance income of ₹200 crore.
“First of all, our Bancassurance income itself is around Rs 200 crore. So, it will not have any substantial impact”
Punjab National Bank's view
Punjab National Bank awaits Irdai's final guidelines before adjusting bancassurance plans.
“As of now, even if we assume that the same draft guideline gets implemented, hardly any impact will be there. It is in the range of around ₹350-400 crore”
Private lenders' response
Axis Bank expects higher sales volumes to offset potential revenue loss while HDFC Bank assesses impact.
The key point
India's public sector banks anticipate small revenue impact from Irdai's insurance distribution reforms while private lenders assess potential revenue changes.
