The Taiwan Cooperative Bank (TCB, 合庫銀行) yesterday inked a joint venture agreement with BNP Paribas Assurance to set up an insurance arm with an initial working capital of NT$2 billion (US$60 million), in which the local bank will take up a controlling 51 percent stake.
Once BNP Paribas Assurance TCB Life Insurance Co (合庫人壽) is launched, TCB will have the right to appoint its chair while its French counterpart will appoint the president, the Taiwanese bank said at a signing ceremony yesterday.
“With operation synergy via resource integration and service portfolio extension, we aim to transform TCB into a financial holding brand that provides full financial services,” TCB chairman Liu Deng-cheng (劉燈城) said, adding that the new insurance entity would benefit from the bank’s 301 outlets nationwide as well as the French insurer’s 35-year experience in bancassurance in 41 countries.
Liu said the new insurer would break even “within two years, no later than three years,” as many existing TCB clients have placed calls and expressed an interest in becoming policyholders.
He did not give a timetable as to when the insurance arm would begin operations.
Jean-Bertrand Laroche, head of BNP Paribas’ international operations, said he would provide his insurer’s expertise to support what he referred to as one of the two pillars that support business.
Financial Supervision Commission Chairman Sean Chen (陳冲) yesterday said the deal would create a “win-win” partnership. A former chairman of TCB, Chen initiated the Taiwanese-French partnership during his tenure.
The new insurer will also be the third of its kind after state-controlled First Financial Holding Co (第一金控) teamed up with the UK-based Aviva PLC to found First Aviva Life Insurance (第一英傑華人壽) in May 2007, while Taishin Financial Holding Co (台新金控) announced plans in December 2007 to form a joint venture with Dutch insurer Aegon NV in Taiwan.