Pan-American Life Insurance Group in New Orleans and Mutual Trust Financial Group in Oak Brook, Illinois, plan to merge their mutual insurance holding companies. Mutual Trust will operate as a subsidiary of Pan-American Life.

Financial terms of the deal were not disclosed.

The combined organization will have its global headquarters in New Orleans and will be led by José S. Suquet, who is chairman, president and chief executive officer of Pan-American Life Insurance Group.

The companies said merging Pan-American Life Mutual Holding Co. and Mutual Trust Holding Co. will strengthen the combined company’s position as a life, accident and health insurance provider in the Americas.

Pan-American Life’s business is focused on Latin America and the Caribbean and will be complemented by MTL’s presence in the U.S. life insurance market and its expertise in the market for affluent customers.

As a result of the merger, the combined company will achieve a greater balance between its international and domestic businesses, officials said.

Mutual Trust will continue to operate under the MTL brand name and execute its current strategy.

The combined company will operate as a mutual insurance holding company with about $1 billion in annual revenue, $5.5 billion in total assets, 1.5 million covered lives and 1,650 employees. It also will have about $1 billion in total capital, enhancing its financial strength.

On its own, Pan-American had total assets of $3.3 billion in 2014 and net income of $49 million on $704 million in revenue.

“Our shared vision, complementary geographic footprints and the opportunity to provide increased penetration of the U.S. Hispanic market for both companies’ core products make this merger attractive for both organizations and our distribution partners,” Suquet said.

“Together, we will have accelerated growth prospects, superior financial flexibility and an enhanced ability to serve the needs of our policyholders and distribution partners,” said Stephen Batza, chairman, president and CEO of Mutual Trust Financial Group.

Pan-American’s Suquet said the company will “work closely with Mutual Trust to ensure the smoothest possible transition for employees and uninterrupted service for customers.”

The merger will have no impact on current MTL policyholder terms, and the existing process by which policyholder dividends are determined will remain in place as part of a dividend protection plan included in the merger agreement.

In addition, there are not expected to be any significant changes to MTL’s distribution channels or management team.

Batza will lead Pan-American Life’s re-launched domestic life business from MTL’s headquarters in Oak Brook. Both companies will share best practices and collaborate on product development and technology.

The merger has been approved by the boards of directors of both Mutual Trust and Pan-American Life, and is expected to close in the second half of 2015, subject to policyholder and regulatory approvals and customary closing conditions.

Pan-American Life’s current nine-person board will be expanded to 12 members, including Batza and two additional current board members of Mutual Trust.

Morgan Stanley & Co. LLC is acting as financial adviser and Willkie Farr & Gallagher LLP and Sutherland, Asbill & Brennan LLP are acting as legal counsel to Pan-American Life. Keefe, Bruyette & Woods Inc. is acting as financial adviser and Sidley Austin LLP is acting as legal counsel to Mutual Trust.