AIG sells Canadian operations for $375 million

TORONTO: Bank of Montreal (BMO) on Tuesday announced it is buying Canadian business of the troubled global insurance giant American International Group (AIG).

The bank said it is acquiring the AIG Life Insurance Company of Canada (AIG Life of Canada) for $375 million in cash.

The deal will provide its clients with a wider range of investment, financial planning and insurance solutions, the Canadian bank said.

"This acquisition is a perfect extension of our existing wealth management offering and our goal to become the one-stop location for all our clients' financial and investment needs," BMO president and CEO Bill Downe said in a statement.

He said the acquisition of AIG Life of Canada will strengthen his bank's financial planning, wealth and retirement offerings.

The bank CEO said, "Our clients, especially those in or near retirement, are looking for security and peace of mind.we will now be able to provide clients with the investment and tax-efficient insurance solutions they need to help them secure their lifestyle and retirement needs."

With the acquisition, he added, the bank will also absorb 300 employees and 400,000 customers of AIG Life of Canada.

For his part, Peter McCarthy, president and CEO of AIG Life of Canada, said: "Our management team is very excited about becoming an integral part of one of Canada's premier financial institutions.

"As part of BMO Financial Group, we look forward to serving our clients and distribution partners and building on our reputation for providing innovative insurance solutions for Canadians."

The bank said operations of AIG Life of Canada will be integrated with its insurance operations over the next six to 12 months and named BMO Life Insurance Company.

Established in 1817, Bank of Montreal is Canada's oldest bank, and one among the top five in the country.