Indian public sector lender Punjab National Bank (PNB) is reportedly planning to sell its entire stake in Canara HSBC OBC Life Insurance (CHOICE).

As per media reports, Punjab National Bank is in talks to appoint legal advisors for the proposed divestment.

The lender had become a promoter shareholder in CHOICE as a result of the merger with Oriental Bank of Commerce and Union Bank of India.

PNB currently holds a 23% stake in the life insurer, 51% stake is held by Canara Bank and HSBC Insurance (Asia Pacific) holds the remaining 26% stake.

PNB’s move is in line with the Insurance Regulatory and Development Authority’s mandate that bars any commercial lender from holding over a 10% stake in two life insurers at the same time.

The lender holds a 30% stake in PNB MetLife insurance.

Earlier this month, HDFC Life agreed to buy a 100% stake in Exide Life Insurance from Exide Industries in a deal worth $915.5m (INR66.87bn).

Upon completion of the deal, Exide Life will be merged into HDFC Life.

India’s insurance giant Life Insurance Corporation (LIC) is slated to go public by the fourth quarter of the financial year 2022.

Last month, Payment and financial services company PhonePe was awarded an insurance broking licence from IRDAI.

In June this year, insurance aggregator, Policybazaar also secured a broking licence from IRDAI.