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February 20, 2024 at 03:37 PM
Truist Financial, a large regional bank, has agreed to sell its 78.1% stake in its insurance brokerage business to an investor group for a deal that could bring it $10.1 billion in cash.
The deal appears to include Crump Life Insurance Services and BenefitMall as well as the Truist Insurance Holdings property and casualty insurance distribution businesses.
Crump is a large life insurance, annuity, disability insurance and long-term care insurance distributor, and BenefitMall helped create the modern online benefits distribution system.
Bill Rogers, Truist’s chairman and CEO, said Tuesday during a conference call with securities analysts that Truist is making the deal partly because the insurance brokerage business needs more capital it can use to make deals.
“We really thought about it in terms of what’s best for the insurance business,” Roger said.
What it means: Crump and BenefitMall could emerge from the deal with money they could use to acquire other insurance and financial services distribution, sales and advisory firms.
The players: Truist is the Charlotte, North Carolina-based bank created by the 2019 merger of BB&T and SunTrust Banks. It ended 2023 with $535 billion in assets.
The insurance business reported $1 million in net income for the fourth quarter of 2023 on $830 million in income, as its parent, Truist, reported a $5.2 billion net loss on $5.8 billion in revenue.
