Carlyle Group has purchased a 9% stake in India’s SBI Life Insurance from major French bank BNP Paribas for an estimated US$653 million.

The insurance company is a joint venture between the government-owned State Bank of India and BNP Paribas Cardif, the bank’s insurance arm. As a result of the deal, SBI remains the largest shareholder in the insurer with a 62.1% holding, while BNP’s stake will be 12.8%.

India’s life insurance industry has strong potential for growth due to favourable demographics and increased public awareness of the need for financial savings, Sunil Kaul, managing director of the Carlyle Asia buyout advisory team, told the Economic Times.

The equity for the investment was sourced from CA Emerald Investments, an affiliated entity of Carlyle Asia Partners V, which is the Carlyle Group's US$6.55 billion fund focused on buyout and strategic investments across a range of sectors in Asia-Pacific.

Carlyle’s other investments in India include PNB Housing Finance and SBI Card. It has been investing in the Asian financial services market for 20 years, with over US$4 billion in equity in more than 15 investments as of end-2018.