Calcutta, Aug. 24: Allahabad Bank will enter the non-life insurance business within the next three months.

Ernst & Young, the consultant appointed by Allahabad Bank to work out a roadmap for its insurance foray, has recommended the non-life segment of the insurance business.

“Ernst & Young has just submitted its report. We are working on it,” chairman and managing director .N. Singh said.

The bank, which will enter the sector through its wholly-owned subsidiary AllBank Finance, is looking for joint venture partners both in India and abroad. It is talking to global non-life insurance companies and has approached public sector banks in India.

“I cannot divulge who will be our insurance partner now. Talks are on. But we are sure to float our insurance outfit within the next three months,” Singh said.

However, some Singapore-based foreign institutional investors are interested in a partnership with Allbank.

AllBank Finance has a capital base of Rs 60 crore, which is not enough to sustain the insurance business. The capital base of an insurance business should be Rs 100 crore. Therefore, the bank is looking for joint venture partners.

Explaining the rationale behind the decision to enter the sector, Singh said: “The non-life sector in India has not witnessed the growth that it should have. But the mindset is changing and there is an immense opportunity in this sector. We have to translate these opportunities into business.”

The bank has already approached the Insurance Regulatory and Development Authority (IRDA) with their proposal on the insurance foray. The bank will need the Reserve Bank’s permission too.

The recent boom in the housing sector has also prompted the bank to think about entering the realty fund business. At present, there are three players in the realty fund — ICICI Ventures, HDFC and Kotak.