PARIS, Oct 25 (Reuters) - French insurer AXA will sell its Belgian banking business - AXA Belgium - to cooperative bank Crelan for 620 million euros ($688.51 million), the company said on Friday.
The deal is part of AXA's drive to simplify its businesses, Europe's second-largest insurer after Germany's Allianz added in a statement.
Under Chief Executive Thomas Buberl, AXA is undergoing a deep restructuring aimed at making the French group more international and stronger on health and property and damage insurance.
"This transaction is another important step in the execution of our Ambition 2020 strategy, as we concentrate on businesses with critical scale and continue to simplify our business profile", Buberl said in the statement.
Last week, three sources familiar with the situation said AXA was considering selling its Central European business in the middle of its restructuring.
Crelan, which will become Belgium's fifth-largest lender after the deal, will pay 540 million euros in cash to AXA for its Belgian banking unit.
The agreement, which should strengthen AXA's balance sheet with an expected more than four percentage points positive impact on the group's Solvency II ratio, also includes the transfer to AXA Belgium of 100% of Crelan Insurance (valued at 80 million euros), the insurance company of Crelan.
The deal is expected to be finalized in the second quarter of 2020, AXA said.
($1 = 0.9005 euros)
Reporting by Benoit Van Overstraeten; Editing by Sherry Jacob-Phillips