BNP/ABN Life Deal In France: Interest In Smaller Financials' Spreads

BNP and ABN in life assurance deal in France. Underpins our point about relative spread strength of smaller financials around Europe:

• ABN has a “high end life insurance” JV with Axa in France which runs as a branded arm of ABN’s French private bank (Neuflize). BNP is buying both parties out of Neuflize Vie (the life JV) to create “an undisputed leader” in this corner of the market with BNP Paribas Cardif (BNP’s life business).
• BNP is also then entering a strategic partnership with ABN’s private bank so its clients retain product access. There are no financial details other than this having a “minor positive” impact on ABN CET1 ratio. We’d assume the reverse for BNP but appear immaterially small.
• The interest here is back to our earlier M&A point. Even without major cross-border M&A (not out of the question for ABN with a market cap of just EUR13.6bn), there are lots of smaller, streamlining deals going on (e.g. Barclays buying Tesco Bank and looking at Goldman’s GM cards business, Aviva buying AIG Life UK, Centerbridge – Aareal last year, Virgin Money and Co-Op Bank both being taken out, Nordea – Danske in Norway).