Ace’s Greenberg Parts With Rivals by Shunning Commercial Lending

Ace Ltd. Chief Executive Officer Evan Greenberg said commercial lending is a risk he wants to avoid at his insurer, even as rivals enter the business seeking yield.

“We’re an insurer, not a bank,” Greenberg said in a phone interview Wednesday, citing dangers including the possibility of borrower defaults. “It’s a banking risk, it’s a lending risk. You have asset-liability mismatch.”

Greenberg, who agreed this month to buy Chubb Corp. for more than $28 billion, said lending would require skills beyond the insurance underwriting that is his company’s focus. Insurer American International Group Inc. committed $1.5 billion last year to start a venture with Oak Hill Capital Management to fund medium-sized companies, while TIAA-CREF opened a lender in April staffed by veterans of Carlyle Group LP.

Insurers are among firms seeking to fill voids left by banks that scale back in some markets amid tighter regulation. The lending can boost investment returns as low interest rates squeeze income from bond portfolios.

“We don’t chase yield,” Greenberg said. “We’re not moving up the risk curve.”

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