Axis Bank Under SEBI Scrutiny Over Max Life Stake Acquisition

The Securities and Exchange Board of India (SEBI) has issued a show cause notice to Axis Bank and its subsidiaries regarding their stake acquisition in Max Life Insurance. This development follows Axis Bank's increased investment in Max Life, raising its ownership to nearly 20%. SEBI's scrutiny seeks to clarify compliance with regulatory guidelines.

The Securities and Exchange Board of India (SEBI) has initiated a regulatory probe into Axis Bank and its subsidiaries concerning their stake acquisition in Max Life Insurance. A show cause notice (SCN) was dispatched via email on October 25, signaling potential compliance issues.

Axis Bank disclosed receipt of the SCN in a regulatory filing, citing their intention to respond and affirming the legitimacy of the transactions under existing regulatory approvals. It was further revealed that personnel from Max Financial Services Limited, the parent company of Max Life Insurance, have also been implicated.

This scrutiny follows the Axis Bank board's approval to enhance their stake in Max Life, an agreement ratified by the Insurance Regulatory and Development Authority of India (IRDAI). The bank's revised acquisition strategy conforms with IRDAI's October 2022 directives and seeks to bolster its position in the insurance sector.

(With inputs from agencies.)