Bank of America sells its insurance portfolio

Bank of America will offload its Balboa insurance portfolio to Australia's QBE Insurance for over $700 million.

Last year Bank of America sold stakes in BlackRock and China Construction Bank to help meet government bailout-aid repayments. Now BofA says that QBE will assume all of Balboa's $1.2 billion in insurance liabilities under the deal.

Over 10 years Frank O'Halloran, CEO of QBE, has made over 75 acquisitions to expand into 50 countries. QBE acquired U.S. underwriting agency ZC Sterling Corp for $575 million in 2008.

Bank of America said QBE would assume all of Balboa's liabilities in exchange for an equivalent amount of cash and other assets through a reinsurance transaction.

QBE entered into a 10-year distribution agreement with the bank for lender-placed insurance and real estate owned programs and certain voluntary consumer insurance products under the deal.

It said the transaction was expected to result in a one-time gain and it would retain Balboa's net tangible equity of $1.7 billion which would be redeployed as the Balboa insurance liabilities expire.