(Bloomberg) -- JPMorgan Chase & Co., the largest U.S. lender, agreed to sell its large-market 401(k)recordkeeping business to a division of Canadian life insurer Great-West Lifeco Inc. Terms of the transaction weren’t disclosed.
The deal will make Great-West the second-largest recordkeeper of 401(k)-type retirement plans by participants, serving 6.8 million workers with a combined $387 billion in assets, the company said today in a statement from Winnipeg, Canada. The largest provider of retirement recordkeeping services, which include sending out account statements and other communications to participants, is Boston-based Fidelity Investments.
JPMorgan, whose recordkeeping business lags behind those of firms such as Fidelity, Vanguard Group Inc. and Prudential Financial Inc., is selling its unit as recordkeeping for workers’ retirement accounts has become less lucrative for firms that don’t have scale. The deal will catapult Great-West from the seventh-largest recordkeeper of 401(k)-type plans by assets in 2012, according to research firm Cerulli Associates, allowing it to compete with the biggest firms.
“Bringing together these platforms allows us to be a market leader,” said Robert Reynolds, who was named last month as president and chief executive officer of Great-West Lifeco U.S., which owns Great-West Financial and Putnam Investments. “You can make money in this business.”
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