Paris, 30 August 2018
CNP Assurances announces the conclusion of a binding framework agreement providing for the establishment of a new long-term exclusive distribution agreement until 13 February 2041 in Brazil in the network of Caixa Econômica Federal (CEF), one of the leading Brazilian banks and one of the five largest in Latin America.
This agreement is an important milestone for CNP Assurances as it secures, for the very long term (23 years) and on a new perimeter, a significant part of the business currently conducted with CEF’s network, and the exclusive access to CEF’s 78 million clients. CNP Assurances will therefore remain CEF’s main life insurance partner in Brazil and at the same time continue developing its other activities in Latin America.
This new agreement builds on the successful track-record of CNP Assurances and CEF’s partnership since 2001, through their Caixa Seguros Holding (CSH) joint venture, which demonstrated an ability to combine strong growth, high profitability and regular cash flow generation:
- premium income growing by 18% p.a. on average between 2008 and 2017
- value of new business growing by 16% p.a. on average between 2008 and 2017
- attributable net profit growing by 14% p.a. on average between 2008 and 2017
- dividend growing by 14% p.a. on average between 2008 and 2017
The new exclusivity perimeter in CEF’s network includes life insurance, consumer credit life insurance and private pension plans (vida, prestamista, previdência). In line with the terms of the non-binding Memorandum of Understanding signed at the end of September 2017, the new distribution agreement will be implemented through a newly formed insurance joint venture between CNP Assurances and Caixa Seguridade, the holding company for CEF’s insurance operations, with CNP Assurances and Caixa Seguridade owning respectively 51% and 49% of the voting rights and 40% and 60% of the economic rights. On the closing date, CSH will transfer to the new joint venture the in-force insurance portfolios for the products included in the scope of the agreement (life insurance, consumer credit life insurance and private pension plans).
Moreover, CNP Assurances reached a separate agreement with Caixa Seguridade and the insurance brokerage group Wiz regarding the terms of the future cooperation with Wiz, including in particular operational back office services provided by Wiz to CSH and to the new insurance joint venture to be created as part of the new agreement concluded with Caixa Seguridade.