IAG has announced the completion of a $128 million investment in its general insurance joint venture in India.

The Australian insurer will initially hold a 26% in the joint venture, the maximum allowed under Indian foreign investment rules. However, IAG has an option to increase its stake to 49% when anticipated regulatory changes are implemented.

The deal with the State Bank of India allows IAG access to 100 million customers through nearly 14,000 bank branches.

The joint venture is named SBI General and is expected to begin trading in the first half of next year.

IAG said in a statement the investment will be funded from internal resources.

“The capital has been invested directly into the joint venture vehicle and no further capital is expected to be required until at least the fourth year of operation.”