Bank of America's Life Insurance Sold
Bank of America Corporation has announced that they are selling their Balboa Life Insurance Co and Balboa Life Insurance Co of New York to Securian Financial Group Inc, located in St. Paul Minnesota. Securian is a private insurance company specializing in retirement planning. The article "BofA Sells Balboa Life to Securian" by Zacks Equity Research on Zacks.com says this is another effort for Bank of America to remove non-core assets from their portfolio.
Balboa Life Insurance Co (BLIC) and Balboa Life Insurance Co New York (BLICNY) offer numerous products including mortgage, accidental death insurance, accidental death & dismemberment insurance, and individual term life insurance products. These services go well with the products offered through Securian Financial and would be operational by 2012. Bank of America says the deal will close October 1, 2011 but no terms of the deal have been disclosed. Despite the sale, Bank of America did retain Balboa's credit card insurance business.
Balboa was inherited from Countrywide Financial which was bought back in 2008 in the midst of the mortgage crisis. Bank of America is lightening their non-core asset business and this is not the first time. Bank of America is committed to shedding this type of business even after repaying bailout money that was used from the Troubled Asset Relief Program. Experts are expecting Bank of America to continue dropping non-core asset business until it regains their capital strength which has taken a beating over the last few years.