Zurich Insurance Acquires ANZ Life Insurance for $2.1 Billion, Becomes Australia’s Biggest Life Insurer

Zurich Insurance Acquires ANZ Life Insurance for $2.1 Billion, Becomes Australia’s Biggest Life Insurer

Zurich Insurance Group has agreed to buy ANZ’s life insurance arm in Australia for AUD 2.85 billion ($2.14 billion).  With the acquisition, the Swiss company will become Australia’s biggest life insurer with an approximate 19% market share of the Australian insurance market.  The deal is expected to complete by the end of 2018.

“Zurich becomes Australia’s Biggest Life Insurer buying $2.1 Billion ANZ”

The deal will also give Zurich access to ANZ’s 6 million customers. It will serve them through the bank’s 680 branches, ATMs, and online services for 20 years. It will increase cash flows by around $225 million over the 2017-2019 planning period.

The transaction price comprises AUD 1 billion of upfront reinsurance commissions, expected to be paid subject to regulatory approval in May 2018 with the remaining balance paid on completion.

“ANZ’s portfolio of non-traditional and profitable retail products fits well with Zurich’s strategy to focus on capital-light protection and unit-linked business. Furthermore, it strengthens the Group’s position in Asia Pacific, while building on our strong bank distribution capabilities,” said Group Chief Executive Officer Mario Greco. “In addition, the existing portfolio provides a highly cash-generative business that will add to our cash remittances, increase our business operating profit after tax return on equity (BOPAT ROE) target by 50 basis points and support dividend growth beyond that implied by our existing plan.”

The acquisition is expected to contribute to the Group’s profitability from day one, generating strong cash flows which will support future dividend growth. The transaction will also increase the proportion of stable life protection-based earnings, reducing overall Group earnings volatility and increasing the proportion of life earnings remitted as cash back to the Group. In view of these earnings benefits, Zurich expects to raise its current BOPAT ROE target by 50 basis points by 2019. The transaction is also expected to increase the level of overall cash remittances over the 2017-2019 planning period by AUD 300 million (USD 225 million).

As part of the transaction, Zurich will enter into a 20-year distribution agreement with ANZ in Australia to distribute life insurance products through bank channels. Under this agreement, Zurich will have access to ANZ’s 6 million customers which are served through the bank’s more than 680 branches and over 2,300 ATMs, as well as digital distribution channels.

Source: Zurich, Reuters, CNBC

 

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About Zurich Insurance Group

Zurich Insurance Group (Zurich) is a leading multi-line insurer that serves its customers in global and local markets. With about 54,000 employees, it provides a wide range of property and casualty, and life insurance products and services in more than 210 countries and territories. Zurich’s customers include individuals, small businesses, and mid-sized and large companies, as well as multinational corporations. The Group is headquartered in Zurich, Switzerland, where it was founded in 1872. The holding company, Zurich Insurance Group Ltd (ZURN), is listed on the SIX Swiss Exchange and has a level I American Depositary Receipt (ZURVY) program, which is traded over-the-counter on OTCQX.

Visit: Zurich

 

About ANZ

Our history dates back over 180 years. We are committed to building lasting partnerships with our customers, shareholders and communities in 34 countries in Australia, New Zealand, throughout Asia and the Pacific, and in the Middle East, Europe and America. We provide a range of banking and financial products and services to over 9 million customers. We employ over 50,000 people worldwide.

Visit: ANZ

 


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ANZ & NAB Bank to Pay $100 Million to Settle Reference Rate Rigging Case

ANZ & NAB Bank to Pay $100 Million to Settle Reference Rate Rigging Case

Australia & New Zealand Bank Group (ANZ) and National Australia Bank (NAB) will pay a combined $100 million ($50m each) for market manipulation – rigging of Australia’s Bank Bill Swap Reference Rate (BBSW) between 2010 and 2012.  The BBSW is a key benchmark interest rate in the Australia economy.

“ANZ, NAB Bank Agree to Pay $100 Million to Settle Swap Rate-Rigging Case”

ANZ was accused of 44 breaches while NAB was accused of 50 breaches.  The $100 million settlement was reached and approved by the Australian court.  The case was brought by the Australian Securities and Investments Commission (ASIC).

Source: Bloomberg, ABC

 

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About ANZ

Our history dates back over 180 years. We are committed to building lasting partnerships with our customers, shareholders and communities in 34 countries in Australia, New Zealand, throughout Asia and the Pacific, and in the Middle East, Europe and America. We provide a range of banking and financial products and services to over 9 million customers. We employ over 50,000 people worldwide.

Visit: ANZ

 

About National Australia Bank

National Australia Bank Group (the Group) is a financial services organisation with over 12,700,000 customers and 42,000 people, operating more than 1,700 stores and business banking centres globally.  Our major financial services franchises in Australia are complemented by businesses in New Zealand, Asia, and the United Kingdom. Each of our brands is uniquely positioned, but built on a common commitment to provide our customers with quality products and services, fair fees and charges, and relationships built on the principles of help, guidance and advice.

Visit: National Australia Bank 

 


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Moody’s Downgrades Australia Banks Credit Ratings

Moody’s Downgrades Australia Banks Credit Ratings

Moody’s has cut the long term credit rating of Australia’s four largest banks, saying increasing home pricing, household debt and low wage growth is posing a threat to lenders. ANZ, NAB, Westpac and Commonwealth Bank of Australia has been downgraded from Aa2 to Aa3. The ratings outlook for all four banks still remain stable.

“ANZ, NAB, Westpac and Commonwealth Bank of Australia has been downgraded from Aa2 to Aa3.”

~ Bloomberg

It comes after Standard & Poor’s recently left the banks’ credit ratings untouched as it downgraded smaller lenders. The combination of soaring house prices and stagnant wage growth has pushed the ratio of household debt to disposable income to 189 percent.

Related Reports: Bloomberg, Sydney Morning Herald


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ANZ to Sell Stake in Shanghai Bank

ANZ to Sell Stake in Shanghai Bank

ANZ is selling its 20% stake in Shanghai Rural Commercial Bank for AUD$1.84 billion to two Chinese state owned firms, China Cosco Shipping Corporationg and Shanghai Sino Poland Enterprise Management Development Corporation. Each will acquire 10% stake in the bank. This marks the bank’s second disposal of Asian holdings over the past three months.

“ANZ is selling its 20% stake in Shanghai Rural Commercial Bank for AUD$1.84 billion to two Chinese state owned firms”

~Financial Times

ANZ is also looking at other opportunities to exit other businesses. Other than its stake in Shanghai Rural Commercial Bank, it holds stake in Malaysia’s AMMB Holdings Bhd, PT Bank Pan Indonesia and China’s Bank of Tianjin Co.

Related Reports: Wall Street Journal, Financial Times

 

About ANZ

Our history dates back over 180 years. We are committed to building lasting partnerships with our customers, shareholders and communities in 34 countries in Australia, New Zealand, throughout Asia and the Pacific, and in the Middle East, Europe and America. We provide a range of banking and financial products and services to over 9 million customers. We employ over 50,000 people worldwide.

Visit: ANZ

 

About Shanghai Rural Commercial Bank

Shanghai Rural Commercial Bank (or “SRCB”) was established on August 25th 2005, which was reincorporated from Shanghai Rural Credit Cooperatives of more than 50 years history. At present, SRCB has registered capital of RMB 3.745 billion, established a business network of more than 300 outlets, and employs more than 5,000 staff.

Visit: Shanghai Rural Commercial Bank

 


The Wealth Insider is the world’s leading wealth intelligence for global wealth managers, investments managers, asset managers, high net-worth service providers and wealthy individuals.  Our global workforce seamlessly present the inside news of the most relevant news, insights, global wealth trends, innovation & digital transformation to our global audience.

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ANZ & Macquarie Employees Tried to Rig Benchmark Rate of Ringgit in Singapore

ANZ & Macquarie Employees Tried to Rig Benchmark Rate of Ringgit in Singapore

ANZ & Macquarie has admitted that some of their employees in Singapore tried to manipulate the benchmark rate for the Malaysian Ringgit. Australia’s antitrust regulator claims that the banks tried to be involved in cartel conduct.

“ANZ & Macquarie has admitted that some of their employees in Singapore tried to manipulate the benchmark rate for the Malaysian Ringgit.”

~ Wall Street Journal

ANZ has agreed that three employees unsuccessfully tried to influence the setting of benchmark rates used to settle contracts for the ringgit on 10 occasions. It agreed to a 9 million Australian dollar (US$6.7 million) penalty. Macquarie, which agreed to pay a A$6 million penalty, said the regulator acknowledged that no senior manager or other employees were involved in the conduct of its junior employee in Singapore.

Related Reports: Wall Street Journal, Australian Financial Review

 

About Macquarie Group

On 10 December 1969, Macquarie’s predecessor organisation, Hill Samuel Australia, opened its doors with three staff and an ambition to provide advisory and investment banking services of an international standard to the Australian market. Now we are a global business operating across 28 countries and with specialist expertise in areas such as resources, agriculture and commodities, energy and infrastructure, with a particular knowledge of the Asia-Pacific region. Since its inception, Macquarie has differentiated itself by focusing on new opportunities, both in product and geography, progressively building expertise in these disciplines and expanding into adjacent areas.

Visit: Macquarie Group

 


The Wealth Insider is the world’s leading wealth intelligence for global wealth managers, investments managers, asset managers, high net-worth service providers and wealthy individuals.  Our global workforce seamlessly present the inside news of the most relevant news, insights, global wealth trends, innovation & digital transformation to our global audience.

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Japan’s Meiji Yasuda and HK Based AIA Keen on ANZ Insurance & Wealth Unit

Japan’s Meiji Yasuda and HK Based AIA Keen on ANZ Insurance & Wealth Unit

ANZ’s sale of its life insurance and wealth business has attracted interest from Japan’s Meiji Yasuda and HK Based AIA. The business is valued at US$3.33 billion by the bank. Meiji Yasuda, Japan’s 3rd largest private sector insurer by assets is attracted to ANZ wealth business and life insurance arm. AIA could increase its exiting Australian business if it buys the ANZ business.

“ANZ’s sale of its life insurance and wealth business has attracted interest from Japan’s Meiji Yasuda and HK Based AIA.”

~Reuters

This is the second major move by an Australian to let go its insurance business. National Australia Bank recently sold its 80% stake in its life insurance arm to Japan’s Nippon Life for A$2.4 billion last month.

Related Report: Reuters

 

About Meiji Yasuda

Meiji Yasuda Life Insurance Company was inaugurated through the merger of the two oldest life insurers in Japan, namely, Meiji Life Insurance Company and The Yasuda Mutual Life Insurance Company.

Visit: Meiji Yasuda

 

About AIA

AIA is the largest independent publicly listed pan-Asian life insurance group – with a presence in 18 markets across the Asia-Pacific region.

Our Vision is to be the pre-eminent life insurance provider in the Asia-Pacific region. That is our service to our customers and our shareholders.

Our Purpose is to play a leadership role in driving economic and social development across the region. That is our service to societies and their people.

Visit: AIA

 


The Wealth Insider is the world’s leading wealth intelligence for global wealth managers, investments managers, asset managers, high net-worth service providers and wealthy individuals.  Our global workforce seamlessly present the inside news of the most relevant news, insights, global wealth trends, innovation & digital transformation to our global audience.

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ANZ to Review its Retail Unit in Asia

ANZ to Review its Retail Unit in Asia

Australia and New Zealand (ANZ) Banking Group is reviewing the company’s retail operations in Asia as it tries to slash costs and increase returns.  The move is expected to strengthen the bank’s balance sheet and help it to meet capital rules that Australia and global regulators are enforcing.

“The review was part of a reshaping of the Asian strategy that includes exiting the commercial business and focusing on its core in debt capital markets, syndicated loans and trading.”

~ Reuters

The review was part of a reshaping of the Asian strategy that includes exiting the commercial business and focusing on its core in debt capital markets, syndicated loans and trading.  Recently, politicians have been calling for a high level public inquiry into a series of allegations of misconduct, including insurance fraud, improper wealth advice and interest rate rigging in Australian banks.

Related Reports: Business Times, Reuters

 

About ANZ

Our history dates back over 180 years. We are committed to building lasting partnerships with our customers, shareholders and communities in 34 countries in Australia, New Zealand, throughout Asia and the Pacific, and in the Middle East, Europe and America. We provide a range of banking and financial products and services to over 9 million customers. We employ over 50,000 people worldwide.

Visit: Australia & New Zealand Banking Corp

 


The Wealth Insider is the world’s leading wealth intelligence for global wealth managers, investments managers, asset managers, high net-worth service providers and wealthy individuals.  Our global workforce seamlessly present the inside news of the most relevant news, insights, global wealth trends, innovation & digital transformation to our global audience.

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