Caixa Economica Federal, the Brazilian government owned bank, has started scouting for partners for its insurance business Caixa Seguridade Participacoes.
Citing documents sent to potential partners, Reuters reported that the bank is looking to clinch insurance deals before the listing of Caixa Seguridade Participacoes.
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The Brazilian state-owned lender aims to raise approximately BRL100bn ($25.27bn) though the sale of assets it owns or manages.
Caixa Seguridade is looking for partners for four units consisting of car insurance, residential insurance, premium bonds and the sale of quotas for acquiring real estate, pools vehicles and other products.
The news agency reported that the partnership will be for 20 years and will come into force from February 2021.
Caixa plans to have up to three insurance companies selling car insurance using its network of 4,170 bank branches.
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By GlobalDataAdditionally, Caixa plans to establish a joint venture partnership to sell residential insurance, premium bonds and consortia products. The partner will own 50% of the new JV’s common shares and 25% of its economic rights.
According to Caixa Seguridade, the three new companies will provide products to the bank’s 93 million customers besides outside consumers.
In order to be eligible for partnership with Caixa, Brazilian companies should own minimum $300m in shareholders’ equity while overseas firms are required to hold more than $1.5bn.
