French insurer AXA and BNP Paribas, the country’s second largest bank, announced that they have concluded an “an agreement in principle” for the sale of BNP’s on-line banking subsidiary Banque Directe to AXA.
BNP’s on-line banking operation has around 100,000 clients and about 140,000 accounts, making it one of the largest such operations in France. AXA indicated that the “acquisition of Banque Directe would complement AXA’s financial offering in France, by providing a well established banking platform to its clients and its distribution networks.”
Although the announcement didn’t indicate the price, analysts have estimated that Banque Directe is worth around € 60 million ($57 million).
The French market for personal insurance – homeowner’s, automobile, complementary health, pension products, etc. – is largely dominated by the country’s banks, who have either established their own insurance subsidiaries, or made partnership and cross selling arrangements with existing insurers such as AXA; therefore, establishing and expanding distribution channels through banks is extremely important in order to maintain market share.
This “bancassurance” model is becoming an increasingly competitive field, as the insurers move into providing more banking and financial services. Axa stated as much in its announcement, indicating that the acquisition of Banque Directe “reaffirms the key role of its distribution channels in its future growth and its ambition to position itself as a provider of global solutions including a banking offering.”
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