LIC, State Bank Exposure Tiny, Finance Secretary Tells NDTV

LIC has invested more than 4 billion USD in Adani Group.

New Delhi:

The senior finance ministry official told NDTV on Friday that the risk to the Life Insurance Corporation of India (LIC) and the State Bank of India from the stock market decline of the Adani Group is very limit. .

“If you’re referring to one of the companies currently in the news, we don’t comment on the fortunes of individual companies. They go up and down based on their own strengths and weaknesses. I’ll answer SBI. and LIC,” said Finance Minister TV Somanathan in an exclusive interview.

“The exposure of the SBI and LIC to any particular company is far below what any investor in a bank or in insurance policies should be concerned with. It is very small. Fate. of a company will not significantly affect any of these institutions and therefore there is absolutely no cause for concern for neither depositors, policyholders nor investors in any of these institutions. Which banks or insurance companies have been nationalized,” he said.

The statement comes as opposition parties intensify attacks on the government, demand debate in parliament and investigate allegations of fraud against the Adani Group that has caused a bloodbath in the stock market. securities.

LIC has invested more than $4 billion in the group, whose combined market capitalization has fallen by more than $120 billion — about half its value — since short-selling research firm Hindenburg Research’s The US makes money by betting on falling stocks, which released explosive reports last week.

State Bank of India, the country’s largest financier, has loaned up to $2.6 billion to companies in the Adani group, or about half the amount allowed under regulations, Bloomberg News reported. , citing an unnamed source. The bank has contacted the company for clarification, Reuters reported.

Parliament leader Jairam Ramesh on Friday said the opposition wants a parliamentary panel or Supreme Court-appointed commission to investigate allegations against the port-to-energy business empire, which there are LIC and SBI among the main investors.

“Only an independent investigation will save the LIC, SBI and other organizations forced by the Prime Minister [Narendra Modi] to invest in the Adani Group,” he said.

On Monday, the LIC said it was reviewing the Adani team’s response to concerns raised by Hindenburg. The insurer holds a 4.23% stake in leading company Adani, while its other investments include a 9.14% stake in Adani Ports and a 5.96% stake in Adani Total Gas.

LIC said it has invested about 1% of assets under management in the Adani group. It added that the Adani debt securities held by LIC are rated AA or higher, complying with India’s investment regulations for life insurers.

The Adani Group called the Hindenburg report “a malicious combination of selective disinformation and old, baseless and discredited allegations that have been examined by India’s highest courts.” check and refute”.

On Sunday, the company issued a 413-page statement refuting all of Hindenburg’s claims, calling it an attack on “India’s growth and ambition story”. Hindenburg said Adani’s statement did not answer most of the questions raised in its report.

Shares of the group’s flagship Adani Enterprises were repeatedly suspended from trading on the Bombay Stock Exchange on Friday, hitting multiple stops en route to a 30% drop before covering losses.

Disclaimer: New Delhi Television is a subsidiary of AMG Media Networks Limited, a Company of the Adani Group.


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