ANZ Offloads Kiwi Insurance Arm
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The ANZ’s success in raising more than $640 million from another asset sale had no impact on its share price yesterday as investors continued to sell it and other financial stocks in the wake of the big offshore sell off on Tuesday in Europe and the US.
Investors are worried about financial stocks, especially banks amid the growing political instability and prospects for a second national election (where extremist populist movements might get control of parliament and take Italy out of the Euro).
ANZ shares fell 1.8% yesterday to $27.21 after being down 2% in early trading.
News that the bank had finally sold its ANZ insurance business to specialist insurance group Cigna for for $NZ700 million ($A644.8 million) made little difference to investors. the money will be used to bolster the bank’s capital buffers.
ANZ New Zealand CEO David Hisco said the sale of OnePath Life NZ includes a 20-year strategic alliance for Cigna to provide insurance advice to ANZ customers, and is consistent with ANZ's strategy to simplify its business.
The move across the Tasman came after ANZ sold its Australian OnePath Life business and some financial planning operations to financial services group IOOF for $975 million in October 2017.
It recently sold its 55% stake in Cambodian joint venture ANZ Royal Bank for an undisclosed sum, and in 2016 sold its retail and wealth business in Singapore, Hong Kong, China, Taiwan and Indonesia.
ANZ still holds minority stakes in three Asian banks to offload as part of its divestment plans. the Commonwealth also is looking to sell a stake it has in an Indonesian bank.
The ANZ said it expects to generate a gain on the sale of OnePath Life NZ of around $NZ50 million ($A46 million).
The sale of OnePath Life NZ requires regulatory approval and is expected to be wrapped up in ANZ’s 2018-19 fiscal year which starts October 1.
The ANZ has also sold off its Australian operations in life insurance, superannuation, and most of its financial advice arm, alongside the Asian retail banking assets referred to above.
ANZ launched a $1.5 billion share buyback late last year, and it has said it will look again at further capital management moves later in the year as it accumulates capital beyond what it is required to hold by regulators.
Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey.
At the AFR he was a finance writer, Finance Editor, News Editor and Chief of Staff. At the Nine Network he was supervising producer of Business Sunday for more than 16 years. He has also written for other online and analogue print publications here and overseas.