Can Fin Homes Ltd (NSE:CANFINHOME) recently signed a contract with “Canara HSBC Oriental Bank of Commerce Life Insurance Company and will now be serving as a corporate agent for its insurance business. Also, recent reports indicate that Canara Bank is planning to sell its stakes in Can Fin Homes.
Prior to entering the contract Can Fin Homes obtained a Certificate of Registration (CoR No. CA0533) from the Insurance Regulatory and Development Authority of India (IRDAI) to get the authority for serving as Corporate Agents for Insurance Business. Now with this new contract Can Fin Homes can start its business in the insurance sector.
The registration of IRDAI is valid up to November 2020. The Company has already developed the much-needed infrastructure for acting as corporate agents for insurance business.
Canara Bank Planning To Sell It Can Fin Stakes
According to the latest report, Canara Bank is planning to sell its 30 percent stake in the listed housing finance subsidiary, Can Fin Homes. The reports also state that bulge bracket private equity funds such as Bain Capital, Baring Private Equity Asia, and TPG Capital Management are in discussion with Canara Bank to buy out these stakes.
Canara Bank has engaged New York-based investment bank Jefferies LLC for running a formal process for finding a buyer. According to the reporting source, the stake sale will occur with either one buyer or even with multiple buyers and it may also happen in tranches. The source stated that they have hired bankers who in turn have approached some big-ticket funds which expressed interest.
Can Fin was set up as a wholly-owned subsidiary of Canara Bank in 1987. As of now, the company has 132 branches, 20 satellite offices, and 20 affordable housing loan centers located in India. The company has a loan book of INR 14, 456 crores and it registered a growth of 36.19 percent in the last quarter with net profit of INR 74.99 crore. However, the percentage of gross non-performing assets (NPA) was the lowest in the home finance sector at 0.40 percent.