Westpac has announced it will sell its New Zealand life insurance business to Fidelity Life Assurance Company for NZ$400 million ($373 million).
In an announcement to the Australian Securities Exchange (ASX), the bank said it would also enter into a 15-year agreement for the distribution of life insurance products to Westpac’s New Zealand customers.
The sale is expected to result in a post-tax gain sale and add about seven bps to Westpac Group’s common equity tier 1 capital ratio.
Westpac chief executive, Peter King, said the sale was the latest step in simplifying the business.
“Life insurance products are important for many New Zealanders and we are pleased to be entering a long-term partnership with a life insurance specialist to continue to help our customers protect themselves and their loved ones,” he said.
At 31 March, 2021, Westpac Life NZ had annual inforce premiums of NZ$149 million.
Fidelity Life Assurance Company was backed by cornerstone investor the NZ Super Fund.