Commonwealth Bank (CBA) has completed the sale of its life insurance business in New Zealand to AIA Group Limited via the sale of Sovereign Assurance Company Limited.
The sale of Sovereign is part of the agreed sale of 100 per cent of CBA’s life insurance businesses in Australia (CommInsure Life) and New Zealand to AIA for $3.8 billion, announced back in September 2017.
At the time, AIA also announced that it had entered a 20-year strategic distribution agreement with ASB Bank, the second largest retail bank in New Zealand and a CBA subsidiary.
CBA chief executive officer Matt Comyn said the completion of the sale of Sovereign represented a key step in CBA’s strategy to create a simpler, better bank focussed on its core banking franchise in Australia and New Zealand.
“Our partnership with AIA will allow our customers in New Zealand to have continued access to high quality life and health insurance products through ASB Bank,” he said.
AIA Group regional chief executive, Bill Lisle, said the acquisition of Sovereign would significantly transform and expand AIA’s presence in New Zealand.
“Our new long-term partnership with ASB is a significant opportunity for AIA in New Zealand. We are confident that ASB’s distribution network, combined with AIA’s regional bancassurance capabilities and life insurance product expertise, will deliver strong insurance propositions for our customers,” he said.
The remainder of the transaction, the sale of CommInsure Life, remains subject to certain conditions and regulatory approvals and is expected to be completed later in calendar year 2018, according to CBA.