Max Life Insurance Company Ltd, a subsidiary of Max Financial Services, has acquired a 2.99% stake in Capital Small Finance Bank for Rs. 49.5 crore, marking a significant milestone for the bank. The investment showcases Max Life Insurance’s trust in the growth potential of Capital Small Finance Bank and its commitment to delivering exceptional value to customers. With this move, Max Life Insurance aims to strengthen the bank’s capital position and support its expansion plans.
Sarvjit Singh Samra, the managing director and chief executive officer of Capital Small Finance Bank, expressed his enthusiasm about the investment, stating, “This investment marks a significant milestone for Capital Small Finance Bank and reinforces our commitment to delivering exceptional value to our customers. It is a testament to the strength of our bank and the trust that Max Life Insurance Company Limited has placed in us.”
Capital Small Finance Bank, established in Jalandhar, Punjab, on April 24, 2016, following a conversion from Capital Local Area Bank, has witnessed substantial growth in recent years. The bank’s impressive performance has positioned it well for continued growth in the future. Max Life Insurance’s investment further bolsters the bank’s capital adequacy ratio (CAR), which is expected to reach 20.77%.
As part of the investment, Max Life Insurance has been allotted a total of 1.06 million shares with a face value of INR 10 per share. The investment includes a premium of INR 458 per equity share. The pre-money valuation of Capital Small Finance Bank stands at INR 160.3 crore, while the post-money valuation is estimated at INR 1,652.5 crore.
The infusion of funds from Max Life Insurance will enable Capital Small Finance Bank to expand its lending and deposit base, reinforcing its capital position. This strategic move aligns with the bank’s objective of meeting regulatory requirements and achieving sustainable growth. The investment signifies Max Life Insurance’s confidence in the bank’s potential and its contribution to the banking sector’s development.
The partnership between Max Life Insurance and Capital Small Finance Bank sets the stage for a mutually beneficial collaboration, leveraging the strengths of both entities. As the bank continues on its growth trajectory, the investment by Max Life Insurance will further strengthen its position in the market and fuel its future expansion plans.
