The ANZ Bank is selling its OnePath life insurance business to American-based giant Cigna.
Cigna will pay $700 million for OnePath life insurance business, which is owned by ANZ Bank. Photo: RNZ / Cole Eastham-Farrelly
Cigna will pay $700 million for OnePath, which it plans to merge with its own local operation to create New Zealand's third biggest life insurance company.
The sale also includes a 20-year strategic alliance for Cigna to provide insurance for ANZ customers.
ANZ has been selling non-core assets around the world as it concentrates on banking.
"[This] is consistent with ANZ's strategy to simplify its business," ANZ local chief executive Dave Hisco said.
"Under this agreement, ANZ will continue to provide life insurance to our customers but these insurance policies will now be manufactured and managed by a world-class insurance provider in Cigna."
ANZ expects to make a profit of about $50m on the sale, which would improve its reserves and financial strength.
The bank would retain its investment and wealth management operations.
Cigna said the acquisition would diversify its business and give it a broader market reach.
OnePath had a profit of more than $32m in the year to last September, a fall on the year before, with revenue of $173m.
ANZ has been quitting businesses around the world it does not regard as core business, such as banks in south-east Asia, and its life insurance company in Australia.
Its medical insurance business was sold to Nib in 2016.
ANZ still owns the business finance company UDC, after the Overseas Investment Office blocked its sale to a Chinese corporation, HNA, because of concerns about the ownership and structure of the Chinese company.