Sampath venturing into insurance, merchant banking

Already aggressive in its core business, Sampath Bank is venturing in to life insurance and merchant banking.

The move follows Sampath receiving required approval from the Central Bank to diversify in to these two areas.

Sampath will set up two subsidiaries to carry out Life insurance and merchant banking. Approval from the Insurance Board of Sri Lanka is also being pursued.

The diversification is expected to strengthen Sampath Bank’s overall prospects.

The globally successful model of bancassurance has not really worked in Sri Lanka though several local commercial banks have either subsidiaries, associates or market products in partnership with fully fledged insurance firms.

Second largest private sector bank HNB has 60% owned subsidiary HNB Assurance, which handles both Life and General. Private sector leader Commercial Bank has an associate, Commercial Insurance Brokers, whilst it recently entered into a Memorandum of Understanding with Chartis Insurance Ltd., to offer General insurance products to the nank’s existing and future customers through bancassurance. Nations Trust Bank (NTB) is also related to Union Assurance Plc. NDB Bank has a major stake in Aviva NDB Insurance as well.