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Friday, July 4, 2014

Itau sells insurance unit to ACE, sees $497 million profit boost, (NYSE: ITUB)

Itau Unibanco Holding SA , Brazil's largest nongovernment bank, expects an earnings boost of 1.1 billion reais ($497 million) from the sale of its high-risk corporate insurance portfolio to global insurance company ACE Ltd, according to a Friday securities filing.ACE will pay 1.515 billion reais in cash for the unit, according to terms of the deal, which was signed on Friday. The unit specializes in offering insurance coverage for big corporate projects in high-risk segments such as oil and gas and infrastructure.ACE said in a separate statement that the transaction is expected to be completed in the first quarter of 2015, adding to earnings immediately. Upon completion, it will make ACE the largest commercial property and casualty insurer in Brazil.In 2013, the unit had about 2 billion reais in gross premiums written and an 18 percent market share.

Itau Unibanco Holding SA is a Brazil-based holding active in the banking sector. Shares of ITUB traded higher by 0.78% or $0.11/share to $14.27. In the past year, the shares have traded as low as $10.35 and as high as $15.54. On average, 11134400 shares of ITUB exchange hands on a given day and today's volume is recorded at 7677758.