Westpac sells life insurance business to TAL

Westpac is selling its life insurance business to TAL Dai-ichi Life Australia for $900 million and enter a 20-year strategic alliance for the provision of life insurance products to Westpac’s customers.

The sale of Westpac Life Insurance Services was announced to the Australian Securities Exchange (ASX) and would see the big four bank exit manufacturing life insurance products and would release “significant” capital back to the bank.

The announcement said the sale represented a multiple of 0.96x FY20 embedded value and included ongoing payments to Westpac. The total accounting loss on the sale was approximately $1.3 billion post-tax, while the transaction would add about 12 bps to Westpac’s level 2 common equity Tier 1 capital ratio.

Related News:

A post-tax loss on large transactions and separation costs of around $0.3 billion was expected to be realized in the Group’s FY21 results, while the balance of loss would be recognized on completion of sale.

Westpac group chief executive specialist businesses and group strategy, Jason Yetton, said the sale was another step in simplifying the bank.

“Life insurance is an important product for many Australians and this sale provides certainty for customers and new opportunities for our people with TAL,” he said.

The transaction was expected to be completed during the second half of the 2022 calendar year subject to regulatory approvals.

TAL group chief executive and managing director, Brett Clark: “This acquisition will enhance TAL’s scale and investment capability for the benefit of all of our customers and partners.

“It will provide us with a strong base for continued growth and reflects our ongoing commitment to offering Australians a range of life insurance options and services to meet their diverse needs. In addition, this transaction will provide exciting opportunities for our people and, on completion, we also look forward to welcoming the Westpac Life team to TAL.

“We look forward to building a successful partnership with Westpac and remain committed to continuing to deliver the best possible outcomes for all our existing partners, customers and stakeholders. We look forward to partnering with Westpac to help more Westpac customers with their life insurance needs.”

 




Recommended for you

Author

Comments

Add new comment