Wells Fargo & Co. said Tuesday it would sell its commercial insurance business to USI Insurance Services, a move that falls in line with a plan the bank announced in May to slash $4 billion in expenses by 2019.
 
Terms of the transaction were not disclosed. Both parties have said the deal is likely to close in the late fall or winter.
 
“The sale of the commercial insurance business reinforces Wells Fargo’s focus on core banking products and services,” Perry Pelos, head of Wholesale Banking at Wells Fargo, said in a statement.
 
As part of the deal, San Francisco-based Wells Fargo will shed several of its insurance practices, particularly those dealing with insurance brokerage and consulting, employee benefits, small business insurance, student insurance, individual health and other units.
 
New York City-based USI has built up its presence in recent years as an insurance broker. Goldman Sachs Group Inc. sold the firm in 2012 in a deal valued at $2.3 billion. Since then, USI has made dozens of acquisitions to build its network of insurers.
 
Reports suggest USI has received acquisition bids this year, some north of $4 billion. Its deal for Wells Fargo’s commercial insurance arm, however, would drive the cost to buy USI even higher.
 
“This is a transformational transaction for both USI and Wells Fargo Insurance,” USI chief executive Michael Sicard said in a release.
 
Sales consultants, account executives, technical resources and other staff will be transferred from Wells Fargo to USI, both companies stated.
 
“I’m confident USI is an excellent fit for our clients and team members,” Tim Prichard, head of Wells Fargo Insurance, said in prepared remarks.
 
Wells Fargo’s personal insurance unit isn’t part of the deal. That arm of the bank, which covers cars, homes and other personal products, will merge into its consumer lending division.