What is the insurance concern over the HDFC group merger?
Answer
Answer
The merger between HDFC Ltd and HDFC Bank announced on Monday, could just about run into problems with RBI over its insurance holdings. RBI has always wanted banks to limit ownership stakes in insurance companies. However, HDFC has large two insurance units viz. HDFC Life and HDFC Ergo General Insurance. It remains to be seen what structure the HDFC group will eventually apply to overcome this barrier or they will seek special approval.