Final IPO norms for life insurance cos by July-end: IRDA

Last month, IRDA had released a set of draft guidelines for insurance companies to raise funds through public offers. As per the draft norms, only insurance companies that have completed 10 years of operation and have strong financials will be allowed to access the capital market

New Delhi: Insurance watchdog Insurance Regulatory and Development Authority (IRDA) today said the final guidelines to allow life insurance companies to raise funds from the capital market will be out by this month-end, reports PTI.

"With regard to life companies, the work on initial public offer (IPO) guidelines is more or less complete and we would be going for gazetting the same as regulation very shortly, perhaps toward the end of this month," IRDA chairman J Hari Narayan told reporters on the sidelines of a FICCI event here.

For life companies, the clause mandating a three-year track record of profitability as a precondition for tapping the capital markets has been removed in the draft guidelines, he said.

As per existing Securities and Exchange Board of India (SEBI) norms, any company which proposes to come out with a public offer should have a three-year track record of profits.

"As regards non-life companies, there is little more work to be done and that may take 2-3 months," he said.

Last month, IRDA had released a set of draft guidelines for insurance companies to raise funds through public offers. As per the draft norms, only insurance companies that have completed 10 years of operation and have strong financials will be allowed to access the capital market.

Insurance firms planning public offers have to seek 'formal approval' from IRDA and then approach SEBI for final approval, the draft norms had said.

As part of the eligibility criteria, the insurance company should have maintained the prescribed regulatory solvency margin during the preceding six quarters, it had said.

In addition, the insurance company should have embedded the value of at least twice its paid-up equity capital, the guidelines had said, adding that the insurance company should be fully compliant with the corporate governance guidelines issued by IRDA.

Mr Hari Narayan said IRDA will come out with a standard definition of critical illness for health insurance purposes within the next 2-3 months.

Asked if the insurer can invest in Indian Depository Receipts (IDRs), he said, "An IDR is essentially investment abroad and according to the Insurance Act, money should be invested in India. There is a legal matter which we are examining."

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Sistema Shyam TeleServices expands board of directors

New board composition as per the Indian telecom licensing norms

Sistema Shyam TeleServices Ltd (SSTL) that nationally operates its telecom services under the MTS brand with over 12 million wireless customers today announced appointment of Feliks Evtushenkov and Alexey Buyanov as director on the SSTL board. Additionally, the company also appointed Vikram Kaushik, former MD & CEO, Tata Sky and Bharat Patel, chairman, Indian Society of Advertisers as Independent Directors on the SSTL board. With these appointments, SSTL board strength now includes 13 members.

Ron Sommer, chairman of the SSTL Board said, "I am delighted to welcome Feliks Evtushenkov, Alexey Buyanov, Vikram Kaushik and Bharat Patel on the SSTL board. They bring with them a wealth of business experience. I am confident that their appointment will further enrich the process of providing strategic guidance to the company. We look forward to their valuable contribution".

In compliance with the Indian telecom licensing norms the SSTL board now has seven Indian and six foreign nationals.

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Daimler AG forays into financial services space

As part of its foray into the Indian market, Daimler Financial Services announced an initial investment of $50 million

Germany-headquartered Daimler AG has forayed into the financial services space in India with the establishment of a new Daimler Financial Services subsidiary in the country.

"Two out of five Mercedes Benz cars and every fourth commercial vehicle of Daimler group worldwide is financed by Daimler Financial Services. We intend to replicate this success story in India," Daimler Financial Services AG Board of Management Chairman Klaus Entenmann said.

Currently, Daimler Financial Services operates in 40 countries, achieving a contract volume of 63.7 billion euros in 2010. As part of its foray into the Indian market, Daimler Financial Services announced an initial investment of $50 million.

He said Daimler Financial Services aims to reach a contract volume of $500 million in India in five years.

Daimler Financial Services India would initially offer finance, leasing and insurance products to customers and dealers of Mercedes Benz cars in India under the Mercedes Benz Financial programme with immediate effect.

Commercial vehicles from Daimler India would also be covered under this initiative.

By 2012, Daimler's truck, 'BharatBenz', is expected to be operational. Daimler Financial Services India would also support sales of financial services for BharatBenz.

Daimler Financial Services provides customers with a full range of automotive financial services, including financing, leasing, insurance and fleet management worldwide.

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