The new company, a joint venture of Canara Bank, HSBC Insurance (Asia-Pacific) Holdings Limited and Oriental Bank of Commerce, has an initial capitalisation of Rs325 crore, HSBC has Rs127 crore, it was released in a statement. The company is a joint venture between state-run Canara Bank, Oriental Bank of Commerce and HSBC Insurance (Asia-Pacific) Holdings Ltd.

"Alongside the regulatory approval, a project team has been established in Gurgaon to build the significant operational and sales support capability that will be needed to serve the immense distribution reach of the shareholders," said MBN Rao, CMD of Canara Bank and chairman of the new insurance JV.

''With the support of Canara Bank and Oriental Bank of Commerce and HSBC's insurance expertise, we have made significant progress in getting the company ready to operate. All three shareholders are committed to ensuring that the new company is operated to world-class standards and is competitive in India's fast-growing insurance market,'' added David L Fried, chairman and chief executive of HSBC Insurance (Asia-Pacific) Holdings Limited.

''Our customers and staff are already tremendously excited about the forthcoming launch and we're taking steps to increase the staffing and support. We expect to see a significant increase in production following the launch of the company,'' said Alok K Misra, chairman and managing director of Oriental Bank of Commerce.

Canara Bank owns 51 per cent stake in the life insurance JV, with OBC holding 23 per cent and HSBC holding the remaining 26 per cent stake. All the shareholders are deeply committed to the Indian life insurance market and are pleased to receive the certificate of registration.

Canara Bank has earned a net profit of Rs. 1,565 crore for the year ended March 31, 2008, which is the highest in the history of the bank, claimed Mr. Rao. Releasing the annual results at a press conference here on Saturday, Mr. Rao said the operating profit for the year stood at Rs. 2,959 crore, while the net profit for the fourth quarter was Rs. 464 crore.

Outlining the business growth in the last fiscal, Mr. Rao said the bank’s core deposits, comprising retail and current and savings accounts (CASA) deposits, recorded a growth of 25 per cent. The bank has also added incremental CASA deposits of Rs. 3,640 crore. Consequently, the ratio of CASA deposits to aggregate domestic deposits improved by 40 basis points to 32.39 as on March 31, 2008.

The decision to shed preferential rate deposits by about 24 per cent had an impact on aggregate deposits, which grew by Rs. 11,691 crore to Rs. 1,54,072 crore. The bank’s net advances moved up by Rs. 8,732 crore and crossed the Rs. 1 lakh crore mark at Rs. 1,07,238 crore. The bank’s global business reached Rs. 2,61,310 crore and credit ratio of the bank improved to 69.6 per cent.

Mr. Rao said advances to the priority sectors rose by Rs. 5,359 crore to Rs. 43,203 crore, accounting for 44 per cent of the bank’s adjusted net bank credit which is well above the 40 per cent norm. Mr. Rao said the bank had targeted a global business of Rs. 3 lakh crore aiming to garner deposits of Rs. 1,75,000 crore and advances of Rs. 1,25,000 crore.,p> He said the insurance joint venture company with Hong Kong Shanghai Banking Corporation (HSBC) would begin operations in 2008-09.