Zurich leads scramble for bank’s insurance assets
Zurich and US insurer Allstate are the major bidders for the insurance wing of the Royal Bank of Scotland (RBS), which is on sale for about £7 billion ($14.5 billion).
Reports from UK financial media suggest Allianz is also in the race, although it is preoccupied with problems related to the poor performance of its Dresdner Bank subsidiary.
RBS insurance assets include Direct Line and Churchill, making it the UK’s largest motor insurer. The steep price has already deterred US investment giant Berkshire Hathaway, Italy’s Generali and China’s Ping An from bidding.
The Edinburgh-based bank is selling its highly profitable insurance arm – it made £900 million ($1.86 billion) in 2007 – to restore its capital ratios. It is attempting to raise an additional £12 billion ($24.9 billion) through a rights issue.
Reports from UK financial media suggest Allianz is also in the race, although it is preoccupied with problems related to the poor performance of its Dresdner Bank subsidiary.
RBS insurance assets include Direct Line and Churchill, making it the UK’s largest motor insurer. The steep price has already deterred US investment giant Berkshire Hathaway, Italy’s Generali and China’s Ping An from bidding.
The Edinburgh-based bank is selling its highly profitable insurance arm – it made £900 million ($1.86 billion) in 2007 – to restore its capital ratios. It is attempting to raise an additional £12 billion ($24.9 billion) through a rights issue.