According to two sources with direct knowledge of the matter at hand, Hong Kong-based insurance firm AIA Group Ltd is close to acquiring Commonwealth Bank of Australia’s (CBA) insurance business, which could be valued as high as $4 billion.
Sources go on to reveal, the deal can be annouced as early as later this week.
Sources preferred the cover of anonimity since they were not authorised to publicly talks about the matter before its public announcement.
Spokesmen for CBA and AIA declined to comment.
Last month, CBA had said it was in talks to sell its life insurance business, however it did not disclose any potential buyer. It introduced an element of uncertainty in its statement when it said the outcome of on-going negotiations were uncertain.
According to analysts, Australia is a prime market for foreign insurers given the size of its population and the growth rate of its economy. The Australian economy is growing faster than most developed markets.
Insurance units of domestic banks have struggled midst growing competition from large foreign insurance companies; new regulations which demand increased capital allocation buffers have added increased competition in the insurance sector. As a result, the sector is seeing a sell-off of such assets.
References:
http://uk.reuters.com
Sources go on to reveal, the deal can be annouced as early as later this week.
Sources preferred the cover of anonimity since they were not authorised to publicly talks about the matter before its public announcement.
Spokesmen for CBA and AIA declined to comment.
Last month, CBA had said it was in talks to sell its life insurance business, however it did not disclose any potential buyer. It introduced an element of uncertainty in its statement when it said the outcome of on-going negotiations were uncertain.
According to analysts, Australia is a prime market for foreign insurers given the size of its population and the growth rate of its economy. The Australian economy is growing faster than most developed markets.
Insurance units of domestic banks have struggled midst growing competition from large foreign insurance companies; new regulations which demand increased capital allocation buffers have added increased competition in the insurance sector. As a result, the sector is seeing a sell-off of such assets.
References:
http://uk.reuters.com
