Exclusive: Citigroup to seek bids for Asia general insurance distribution deal - source
By Anshuman Daga
SINGAPORE (Reuters) - Citigroup Inc (C.N: Quote) will seek bids from global insurers keen to sell general insurance products across the U.S. bank's Asia-Pacific markets, in a deal that could be worth at least $500 million, a source with knowledge of the matter told Reuters.
Citi's move underscores how banks are leveraging their network of branches and customer base to generate assured revenue over many years, as demand for insurance grows in the region, the source said.
The multi-year, bancassurance deal for products such as motor, property and travel insurance, will be one of the largest of its kind in the region, and give insurers access to 15 million customers of Citibank in 12 markets including Singapore, Hong Kong, China, India and Australia.
Citi will kick off the process for the 15-year deal in a few days, and expects to choose a partner in a few months, said the person who declined to be identified as the information was not public.
The exact value of the non-life insurance deal will depend on various issues including how bidders structure upfront payments and calculate net present value of future commissions and deferred payments, the first source said.
A spokesman at Citi declined to comment. AIG and Allianz also declined to comment.