ANZ Bank New Zealand is to sell its New Zealand life insurance business to US-listed Cigna for $482m, in the second sale of an ANC non-core business in less than a month.
The deal would generate a gain on sale of around NZ$50m, the company said in a statement on Wednesday. ANZ New Zealand said the deal included a 20-year strategic alliance for Cigna to provide insurance to ANZ Bank customers. It added that current policy holders would continue with existing coverage.
The transaction marks ANZ’s second disposal this month, after it sold a majority stake in a Cambodian joint venture to Japan’s J Trust.
This follows a trend among major Australian banks to offload non-core businesses to trim their capital requirements and simplify business structure. National Australia Bank said earlier this month it was looking to exit part of its wealth management arm by 2019. ANZ Bank’s sale includes a 20-year strategic alliance for Cigna to provide insurance solutions for ANZ bank customers and is consistent with ANZ’s strategy to simplify its business.
ANZ New Zealand chief executive David Hisco said: “Under this agreement, ANZ will continue to provide life insurance to our customers but these insurance policies will now be manufactured and managed by a world-class insurance provider in Cigna.
He continued: “This is consistent with how we provide motor vehicle, home, commercial and travel insurance using a range of specialist insurance partners.”
Cigna New Zealand chief executive Gail Costa said: “This acquisition will enable us to provide broader solutions and be more agile and responsive to a larger customer base.”
The deal, which is subject to regulatory approval, is scheduled for completion in 2019.