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.

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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.

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.

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