Is Westpac's (ASX:WBC) life insurance approaching its sell-by date?

Rumours that Westpac is putting its life insurance business under the hammer are swirling.

| More on:

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Westpac Banking Corp (ASX: WBC) is reportedly gearing up to receive final bids to sell off its life insurance business. So far, media reports haven't affected the Westpac share price.

The bank's share price closed at $26.62 today ­– 1.26% higher than its previous close.

Let's look at the rumours of Westpac's latest divestment.

salesman explaining product on computer screen to couple

Image source: Getty Images

Life insurance under the hammer?

According to reporting by The Australian, parties interested in purchasing Westpac's life insurance business will need to get their bids in by 25 June.

Unnamed sources told the publication the board will make a final decision on where to send the business once bidding has closed.

The purported trading of its life insurance business follows Westpac's sale of its general insurance business to Allianz for $725 million late last year.

­Dai-ichi's TAL and Resolution Life are said to be interested in acquiring the life insurance business.

The Australian said Westpac was asked to comment on the sale but declined.

Westpac is the last of the big four banks to sell out of life insurance.

Commonwealth Bank of Australia (ASX: CBA) was the first of the big banks to sell its life insurance business in 2017.

National Australia Bank Ltd (ASX: NAB) followed suit, selling its Australian life insurance business in 2018 and its New Zealand counterpart last year.

In 2019, Australia and New Zealand Banking Group (ASX: ANZ) sold its life insurance business.

Westpac share price snapshot

It's been a stunning year for the Westpac share price on the ASX.

Shares in the bank are currently 37% higher than at the start of 2021 and have gained 52% since this time last year.

Westpac has a market capitalisation of around $96.4 billion and a price-to-earnings (P/E) ratio of around 22.4. It has approximately 3.6 billion shares outstanding.

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. 

The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Bank Shares

A woman wearing a yellow and white striped top and headphones plays excitedly with her phone.
Bank Shares

5 reasons to invest $500 in CBA shares

For long-term investors, reliability and scale can matter more than short-term valuation.

Read more »

Australian dollar notes and coins in a till.
Dividend Investing

How many ANZ shares do I need to buy for $10,000 a year in passive income?

ANZ shares have a lengthy track record of paying two dividends a year.

Read more »

View of a business man's hand passing a $100 note to another with a bank in the background.
Bank Shares

In the midst of economic turmoil, what does Morgan Stanley say the ASX banks are worth?

The economic headwinds are building.

Read more »

Three children wearing athletic short and singlets stand side by side on a running track wearing medals around their necks and standing with their hands on their hips.
Bank Shares

ANZ, NAB, Westpac, and CBA shares: Analysts rate 3 to sell, and 1 to buy

One ASX bank stock stands out from the rest.

Read more »

Three businesspeople leap high with the CBD in the background.
Bank Shares

Macquarie shares soar 21% to a 52-week high: Buy, sell or hold?

The investment bank's shares climbed higher again on Wednesday. Here's what analysts expect from the stock next.

Read more »

Woman leaping in the air and standing out from her friends who are watching.
Bank Shares

$5,000 invested in CBA shares two years ago is now worth…

It shows you don’t need high-risk growth stocks to build wealth.

Read more »

Woman in business suit holds both hands out with a question mark above each hand.
Bank Shares

What's going on with the ANZ share price?

ANZ shares have gone on a rollercoaster ride this year.

Read more »

Worried woman calculating domestic bills.
Bank Shares

Are Westpac and Bank of Queensland shares a buy, hold or sell?

Which does the broker prefer?

Read more »