Philamlife buys BPI stake in life insurer for P1.35B

Ayala-led Bank of the Philippine Islands will get P1.35 billion from The Philippine American Life Insurance Company for the sale of its 51 percent stake in Ayala Life Assurance Inc. In a letter to the exchange, BPI senior vice-president Gertie K. Sinio said the transaction is expected to be closed by December if all regulatory approvals have been obtained. “The proceeds of this sale will be for potential opportunities for the Bank. We see no material effect on BPI’s financial condition in relation to this transaction," Sinio said. The country’s largest insurer would acquire 382.5 million common shares in Ayala Life. In search of a strategic bancassurance partner, BPI invited a shortlist of “qualified and reputable" partners to a first round bid process. Sinio said the BPI board of directors accepted Philamlife’s offer for the life insurance company where the country’s third largest lender has a 98.67 percent stake. “This transaction shall be subject to the terms and conditions of the definitive agreements to be signed by BPI and Philamlife," she added. During the seven-month period, Ayala Life posted a 140-percent increase in gross premiums at P2.6 billion as a result of bancassurance sales. In a joint statement issued Wednesday, Philamlife and BPI said the bancassurance venture would benefit from the combined strength of two leading financial companies in the Philippines. Philamlife will bring insurance distribution, product development, and innovation to the joint venture, particularly in the area of bancassurance, while gaining exclusive access to BPI’s customer base via its extensive branch network. On Friday, BPI shares gained P0.50 to close higher at P45. - Ruby Anne M. Rubio, GMANews.TV