이 기사는 2021년 12월 10일 08:05 thebell 에 표출된 기사입니다.

KB Life Insurance and Prudential Life Insurance Company of Korea will operate separately under the ownership of KB Financial Group as the South Korean financial services holding company concluded that a merger of its two life insurance subsidiaries would bring little synergy due to their different business focuses.

“KB Financial originally considered the combination of the two firms, but not anymore,” a source familiar with the company’s plans said on Wednesday. “They will continue to operate separately, with KB Life focusing on digital opportunities and Prudential Life using its strong sales network to expand its business.”

Speculation about a merger has swirled for more than a year since KB Financial acquired the US life insurer’s South Korean unit for approximately 2.3 trillion won ($1.9 billion) in September 2020.

Heo Jung-soo being appointed as KB Life’s chief executive for a third term at the end of last year also appeared to be in line with a potential merger plan as Heo previously led post-merger integration for LIG Insurance and Hyundai Securities, which were acquired by KB Financial in 2015 and 2016 respectively.

However, the holding company has ultimately decided not to combine the two life insurers and to let them focus on what they can do better, at least for the next few years.

This could be a decision that also makes sense when considering the asset size of the two firms: Prudential Life’s total assets of 25.6 trillion won were more than twice KB Life’s assets of 10.8 trillion won at the end of September. Such a large difference could make their integration difficult.

Prudential Life will change its name before the end of next year according to the agreement between KB Financial and Prudential Financial. A new name has not been confirmed, but the frontrunners being discussed internally are KB Star Life and KB Premium Life, according to sources.

With the two companies continuing to be run separately, Prudential Life is expected to focus on strengthening ties with the private banking and asset management arms of the conglomerate to sell more life insurance products by fully utilizing its sales capabilities.

Meanwhile, KB Life will step up efforts to accelerate its shift to digital while further expanding its bancassurance channel and its network of general agencies. (Reporting by Min-young Kim)