LIC to soon get bankers on board for managing lending operations
|Source: The Hitavada Date: 15 Apr 2017 08:52:27|
INSURANCE behemoth LIC will soon obtain the services of retired bankers to strengthen its lending operations and ensure that NPAs are kept at the minimum.
LIC had set up a cell for its lending, NPA resolution and one-time settlement (OTS), sources said, adding the company would soon get experts particularly bankers to this portfolio. LIC had been into the business of insurance but they did not have expertise on loan risk assessment and resolution, sources said. A standard operating procedure had also been worked out for repayment through one-time settlement scheme, they added.
At the end of March 2016, LIC had a debt portfolio of Rs 3.79 lakh crore, bigger than the loan portfolio of most banks. Its gross non-performing assets stood at 3.76 per cent at the end of March 2016, up from 3.30 per cent in the previous year.
Driven by the sudden surge in single premium policy sales and falling interest rates, total new business premium of LIC rose 25.8 per cent to Rs 1.22 lakh crore in FY 2016-17 from around Rs 97,000 crore in the previous year.
However, the State-owned insurer witnessed degrowth in terms of policies during the year under review. Total new business premium, including pension and group business, rose to Rs 1.22 lakh crore in 2016-17 from around Rs 97,000 crore a year ago, a senior LIC official said. New business on the individual basis zoomed 47 per cent to Rs 37,800 crore from Rs 25,700 crore a year ago.
New business on individual basis jumped 122 per cent from the projected target of Rs 31,000 crore in 2016-17.