Australian banks are concentrating on their core competencies so the script goes. That means a halt to wealth management and insurance. They are not alone.
ANZ became the latest Australian bank to sell its individual life insurance business, in this case to Zurich for $2.85 billion, in a deal that will establish the acquirer with a 19% market share. In addition, Zurich gets a 6% slice of the group insurance market. (Zurich also bought Macquarie's Life assets recently).
The deal follows AIA group's acquisition of Commonwealth Bank of Australia's life business.
CBA's transaction came at richer multiples of its life unit's embedded value and earnings.
Both transactions specify distribution agreements based on strategic partnership.
Recently, ANZ divested its superannuation, investments and aligned dealer groups business to IOOF Holdings for $975 million.
How ANZ and CBA add value with the proceeds from divestiture will be keenly watched.