Now insurance companies will be able to raise capital by issuing preferred stock without IRDA approval

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Language , Updated: Jul 31, 2022, 5:27 PM

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New Delhi, Jul 31 (PTI) In a bid to promote ease of doing business, the insurance regulator, the Insurance Regulatory and Development Authority of India (IRDA), has decided to remove the requirement for prior approval by insurance companies to raise capital through preferred stock. and subordinated debt. Has decided. According to sources, the decision was made during the recent board meeting. According to this provision, the other form of issued capital (OFC) must not exceed 50% of the net worth or paid-up share capital of an insurance company. The Board of Directors has approved the purchase option (at a later date)

New Delhi, Jul 31 (PTI) In a bid to promote ease of doing business, the insurance regulator, the Insurance Regulatory and Development Authority of India (IRDA), has decided to remove the requirement for prior approval by insurance companies to raise capital through preferred stock. and subordinated debt. Has decided.

According to sources, the decision was made during the recent board meeting.

According to this provision, the other form of issued capital (OFC) must not exceed 50% of the net worth or paid-up share capital of an insurance company.

The board has also removed the requirement to obtain prior approval for “call options (option to buy at a future date)”. Other approved improvements relate to distribution and management expenses.

This is the first board meeting under the leadership of new IRDA President, Debashish Panda.

The board increased the maximum limit for insurance companies to invest in banking, financial and insurance services (BFSI) companies from 25 percent of their assets to 30 percent.

The Board of Directors also took a decision regarding the distribution. According to this, a corporate officer can now partner with nine insurers such as life insurance, general insurance and health insurance companies.

Source: navbharattimes.indiatimes.com

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