He would be helped in this venture by Ms. Shobhana Murali, who was earlier handling corporate communication at the Life Insurance Corporation of India. She will head the new financial services company. Speaking about the staff, Nair said that apart from the key management posts, the rest of the staff in LIC HFL Financial Services would be externally recruited.

He also said that the company plans to start of in the metros, before increasing its operations into different parts of the country.

LIC HFL also has plans for a venture capital fund this year. The fund which was incorporated in February last may begin with a corpus of Rs 500 crore to start with.

Explaining about this fund, Nair said, “This will be a realty fund, which will invest in housing projects and new constructions. Besides LIC HFL, LIC may also participate in this fund. We are also trying to rope in some more like-minded partners.”

He added that a fund manager will soon be appointed for this purpose.

LIC HFL had registered an impressive growth of 38 per cent in loan disbursements in the last financial year at Rs 7,071 crore. This was higher than the industry’s average growth of 8-9 per cent. “This year we hope to do better than last year,” Mr Nair said.

Commenting on the recent hike in the repo rate and CRR by the RBI, he maintained that it was too early to take a decision on it. He admitted that there was pressure on lending rates, but said that a final call would be taken only in July.