Three MDs to collectively decide on LIC investments now
Amidst some of its investment decisions being questioned by many, insurance behemoth Life Insurance Corporation, which manages Rs 25 trillion of assets, has divided its investment portfolio among the three managing directors so that a more balanced decision can be taken.
Last week, chairman V K Sharma distributed the portfolios among the three recently appointed MDs, sources at the Corporation, which is the largest institutional investor in the country, told PTI.
For the past many years, the life insurance giant had been functioning with only one or two MDs, but since fiscal 2015, it was only Usha Sangwan holding the fort. The top management of the Corporation consists of the chairman and four MDs below whom there are 40 executive directors.
It can be noted that LIC has been criticised for being driven into investment in many state-run units by the government in the past.
Most of the failed or not-so- successful follow-on options by the state-run companies in the past were bailed out by the Corporation.
Now, LIC along with other state-run insurers are under legal scrutiny at the Bombay High Court for being the largest investor in the tobacco major ITC and other companies in the sector after a PIL has questioned the rationale. LIC and the five state-run general insurers hold over 30 per cent in the company now.
Though to put the record straight, LIC does not own these shares on its own but on behalf of government holdings in Suuti. LIC, through this, holds more than 16 per cent in the largest cigarette maker and even others did not purchase these shares from the market but transferred to them by the government, which they have already informed the court too.
According to the portfolio allocation order issued by the chairman last week, Sunita Sharma, the junior most MD, will oversee the investment operation department, while B Venugopal will handle the risk management and research part of the investment portfolio and Hemant Bhargava has been given the charge of monitoring and accounting, the sources said.
The investment department is divided into three verticals -- monitoring and accounting, risk management and research and investment operations, which is the most important of the three. Earlier, all the three wings were reporting to the MD in-charge of investment portfolio.
The marketing department, that mobilises around Rs 2.5 trillion in premium annually and also the customer relationship management department, has been given to Usha Sangwan, while Bhargava is in also charge of the personnel and HR departments overseeing around 1 lakh employees of the Corporation.
Sangwan is also in charge of the newly-created department called the mission office for digital India, while Venugopal holds the additional charge of the finance department.
Earlier, LIC revamped the senior management to improve performance by transferring as many as 40 executive directors.
The Corporation had shifted the product development head in the marketing department Vinay Sah to head its housing finance arm LIC Housing Finance. The position was vacated by Sunita Sharma on her elevation as an MD.
Sah's position has been filled in by Saroj Dikhale, who had been heading LIC Mutual Fund in the past.
LIC Housing Finance will now be headed by Raj Kumar who was heading the Bhopal office of the Corporation so far.
P K Molri will be looking after the investment operations wing of the Corporation, replacing V Chandrasekaran who has been shifted to the investment research department.
The Corporation has registered a 27.22 per cent growth in the new business premium in terms of the first-year premium in fiscal 2017.
The Corporation garnered total first-year premium of Rs 1.24 trillion in the year gone-by against Rs 98,000 crore in the previous fiscal, helping it improve its market share to 71.07 per cent.