Westpac could soon join the rest of the big four lenders in exiting the life insurance industry.
The other three major Australian banks have already sold most of their life insurance units in a back-to-basics trend towards core mortgage lending. In 2016, NAB sold 80% of its life insurance unit to Nippon Life for $2.4 billion. ANZ’s life insurance arm was sold to Zurich Insurance for $2.85 billion in late December 2017. This was followed by AIA Group’s purchase of CBA’s life insurance unit in 2018.
Sources told Reuters that Westpac is considering the divestment of its life insurance business and has received some interest, including from insurer American International Group (AIG), with discussions now at a preliminary stage.
One source said that a deal, with the potential value of $1.5 billion to $2 billion, would likely involve a long-term partnership with the buyer, rather than a clean asset sale.