FILE PHOTO: A view shows the company logo of Caixa Economica Federal bank in downtown Rio de Janeiro August 20, 2014. REUTERS/Pilar Olivares

SAO PAULO (Reuters) – France’s CNP Assurances SA (CNPP.PA) has reached a deal worth 7 billion reais ($1.7 billion) with Caixa Economica Federal [CEF.UL] to sell insurance in the bank’s more than 3,000 branches, the Brazilian state-owned lender said on Thursday.

Earlier on Thursday, Reuters reported that the companies would create a joint venture with Caixa insurance unit Caixa Seguridade holding a 60% stake and CNP owning the rest.

The deal involves life, pension plans and consumer credit life insurance to be sold through 2046, Caixa said in a filing.

One year ago, both financial institutions had agreed to create a similar joint-venture, in which CNP would have paid 4.65 billion reais for a contract to sell life insurance products through 2041. This deal has been revised under new terms.

The new joint venture will start to operate in 2021, when the current agreement will expire.

The deal is expected to be formalized by the end of 2020, Caixa said. CNP’s 7 billion-real payment will be made up front.

Morgan Stanley is advising Caixa to forge partnerships for its insurance units, including this renegotiation with CNP. JP Morgan Chase is advising CNP Assurances.

Reporting by Carolina Mandl; Editing by Lisa Shumaker

Our Standards:The Thomson Reuters Trust Principles.


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