Federal Bank Shares Gain After Acquiring Additional 4% Stake In Ageas Federal Life
Federal Bank’s stake in Ageas Federal Life Insurance Company from 26% to 30%; Key points
Federal Bank shares gained to Rs 196 apiece on March 26 following the company’s announcement of a binding memorandum of understanding (MoU) with Ageas Insurance International NV and Ageas Federal Life Insurance Company (AFLIC) to acquire an additional 4% equity stake in AFLIC for Rs 97.44 crore.
This year, Federal Bank’s stock has declined by 3%, underperforming the Nifty 50, which has seen a modest 0.3% drop.
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With this acquisition, Federal Bank’s stake in AFLIC will rise from 26% to 30%. The deal involves purchasing 3.2 crore shares at Rs 30.45 per share, subject to regulatory approvals from the Reserve Bank of India (RBI) and the Insurance Regulatory and Development Authority of India (IRDAI). The transaction is expected to be completed by October 31, 2025.
AFLIC, a joint venture between Ageas Insurance International NV and Federal Bank, reported a net worth of Rs 1,176 crore, assets under management of Rs 17,455 crore, and a net profit of Rs 107 crore for FY24.
In Q3, Federal Bank posted a net profit of Rs 955.4 crore, reflecting a 5% year-on-year decline. However, its net interest income (NII) rose 14.5% YoY to a record Rs 2,431.3 crore.
Recently, the bank’s new Managing Director (MD) and CEO KVS Manian revealed plans to propel Federal Bank from No. 9 to No. 5 within three years, driven by both organic and inorganic growth.
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