Japanese groups are reportedly in the running to buy Westpac’s life insurance business.
With the sale of Westpac’s mortgage insurance division to Arch Capital, the big bank is turning its attention to the life insurance business, which has been slated for sale for some time.
The sale of Westpac’s life insurance operations is being handled by investment bank JPMorgan, according to a report by The Australian. Resolution Life and TAL Insurance, owned by Japanese company Dai-ichi, are in the running for the business, and other Japanese groups are also reportedly expressing interest. Mitsui is reportedly considering throwing its hat in the ring, as is Nippon Life.
Some market watchers suspect that TAL is not a serious contender, since the division has a life insurance agreement with Westpac and Dai-ichi isn’t heavily into group life insurance or superannuation funds, which is what the Westpac business offers, The Australian reported.
Resolution has a different strategy toward the operation than the Japanese groups. It would run the Westpac assets off over time, while TAL has plans for growth, The Australian reported.
Resolution snapped up AMP’s life insurance business last year for $3 billion, and has been viewed by experts as a logical acquirer for Westpac’s business. US-based AIG had considered acquiring the Westpac life insurance business, but ultimately decided against it.
The big four banks are selling non-core assets such as insurance operations as they narrow their focus on mortgages and deal with the challenges of the COVID-19 pandemic, low interest rates and increasing regulation, The Australian reported.
