More pain for Axis Bank shareholders as SEBI sends notices to group entities Axis Securities, Axis Capital?

Axis Bank and its subsidiaries, Axis Securities and Axis Capital, received show-cause notices from SEBI regarding the group's acquisition of a involvement successful Max Life Insurance. Axis Bank and its 2 entities received the announcement done email connected October 25, according to a regulatory filing by the backstage assemblage lender connected Saturday. The improvement assumes value arsenic it comes amid allegations that the Axis Bank-Max Life Insurance woody violated just marketplace worth norms.

Several Max Life Insurance elder executives besides received SEBI notices via email. Max Financial Services, Max Life Insurance's holding company, engages successful concern concern and provides absorption advisory services.

Axis Bank stated that the show-cause announcement is being reviewed and that they volition record responses with SEBI, citing requisite regulatory approvals for the transactions.

In August, the Delhi High Court directed SEBI, RBI, and IRDAI to analyse the matter. Axis Bank acquired further Max Life Insurance equity shares worthy Rs 336 crore, expanding their involvement to astir 20 per cent from 19.02 per cent aft receiving security regulatory approval.

"The Hon’ble High Court vide its Order dated August 12, 2024, noted that sectoral regulators are already ceased of this matter, and directed their probe to beryllium expeditiously completed successful accordance with law,” Axis Bank said. 

As portion of a 2021 deal, Axis Bank accrued its holdings successful Max Life Insurance to 19.02 per cent from 12.99 per cent successful April, initially investing successful 2020.

Last year, Axis Bank signed a revised statement with Max Financial Services to get an further 7 per cent successful Max Life Insurance utilizing the discounted currency travel method, pursuing October 2022 guidelines from the security regulator.

Max Life Insurance is simply a associated task betwixt Max Financial Services and Axis Bank. Axis Bank provides retail banking services, including lending, portion Max Life Insurance offers beingness insurance, annuity products, and concern plans.

Regulatory support is required for deals beyond a definite threshold to forestall unfair concern practices and beforehand just competition.

On Monday, Axis Bank shares ended weaker by Rs 17, oregon 1.4 per cent, astatine Rs 1,170.7 apiece connected BSE, underperforming a market-wide betterment successful the header indices pursuing a losing streak that lasted 5 trading sessions successful a row. 

As of October 28, Axis Bank shares person weakened astir 5.0 per cent, underperforming the banking handbasket connected Dalal Street arsenic reflected successful a 3.2 per cent diminution successful the Nifty Bank during this period. 

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