Aug 12 (Reuters) - Bank of America ( BAC ) will acquire as

much as a 49.9% stake in the non-bank lending arm of Jio

Financial Services in a 182.68 billion rupee ($1.92

billion) deal, as the U.S. lender expands its presence in

India's fast-growing financial sector.

The deal extends a recent run of large foreign investments

in Indian banks and non-bank lenders, which are seeing a strong

demand for credit and low loan delinquency rates.

Recent deals include Japan's MUFG investment in

Shriram Finance, Dubai-based bank Emirates NBD's

60% stake purchase in RBL Bank and Sumitomo

Mitsui Financial Group's investment in Yes Bank.

Bank of America ( BAC ) will become a joint venture partner in

non-banking finance company Jio Credit through a preferential

allotment of equity shares and warrants, the two companies said

on Wednesday.

ACCESS TO A FAST-GROWING MARKET

The transaction, which values Jio Credit at around $3.8

billion according to a Reuters calculation, initially gives BofA

a 26.5% stake, with its holding potentially rising to 49.9%

after the exercise of the warrants.

Jio Credit will issue shares worth up to 66.13 billion

rupees and warrants worth up to 116.55 billion rupees to BofA as

part of the deal.

"By combining Jio Financial Services' scale, local expertise

and customer base with Bank of America's ( BAC ) global reach, digital

experience and close to 250 years of leadership in banking, we

can help expand access to financial services and support India's

continued economic growth," BofA CEO Brian Moynihan said.

Jio Credit is among India's fastest-growing NBFCs, with

assets under management of more than $3 billion as of June-end,

within just two years of operations.

The investment offers Jio Credit capital to support its

growth while getting the expertise of a global financial firm,

Bank of America ( BAC ) said.

Non-bank credit in India is growing at a rapid pace of over

14% across segments like personal loans, gold loans and

small-business credit.

JIO FINANCIAL's JV STRATEGY

Jio Financial, which listed in 2023 after a demerger from

Indian billionaire Mukesh Ambani's Reliance Industries

, operates businesses such as digital lending,

payments, insurance broking and asset management services.

The company has chosen to forge joint ventures with global

firms across a number of its business lines. It offers asset and

wealth management services through its joint ventures with

BlackRock. It has also entered a JV with Germany's Allianz to

offer general and health insurance.

($1 = 95.3300 Indian rupees)

(Reporting by Nishit Navin in Bengaluru; Editing by Abinaya V,

Maju Samuel and Arun Koyyur)