Mumbai, Dec. 20: Union Bank of India will form an alliance with Bank of India and Japan’s Dai-ichi Mutual Life Insurance of Japan to enter life insurance.

Union Bank today informed the stock exchanges that a memorandum of understanding (MoU) for the venture would be signed tomorrow. However, the bank did not divulge details of the shareholding structure and the investment that will go into the insurance venture.

Earlier this year, Dai-ichi joined hands with Bank of India and Andhra Bank for life insurance. But Bank of India wanted to hold a larger stake between 30 and 51 per cent in the joint venture and Andhra Bank walked out of the arrangement as it did not want to be a junior partner and wanted more than the 23 per cent stake that was being offered.

Dai-Ichi Mutual Life Insurance Company is the second largest life insurance company of Japan and is among the top ten companies globally in terms of written premium.

Last month, Union Bank and Bank of India entered into an alliance with Infrastructure Development Finance Corporation.

Though the alliance focussed largely on joint lending and loan syndication for infrastructure projects, both Bank of India and Union Bank decided to come together to offer other facilities to their customers.

These include cash management services in international operations where Bank of India will be the preferred bank for Union Bank for its overseas customers. The senior management of these banks had then indicated that they would cooperate in other fields as well.

Over the past few months, domestic banks and other entities have entered life insurance as the segment continues to remain untapped.