NEW YORK (Reuters) — Bermuda-based insurers may be among the bidders as US bank Wells Fargo & Co prepares to divest its crop insurance business, one of the biggest in the US.

According to sources with knowledge of the matter, the bank has launched an auction for the business, which could sell for more than $1 billion. The sources cited Bermuda-based pair PartnerRe Ltd and Axis Capital Holdings Ltd as potential buyers.

Wells Fargo said it is reviewing strategic options for its Rural Community Insurance Services (RCIS) subsidiary that may include a sale, excluding the Wells Fargo Insurance Crop Agency, its brokerage arm.

“Wells Fargo regularly evaluates the strengths and strategic fit for each of its businesses. As our model continues to evolve, we are more focused on increasing cross-sell and growing the distribution side of the insurance business,” a Wells Fargo spokeswoman said in a statement.

Bidders for RCIS could include reinsurers seeking exposure to the primary insurance market such as PartnerRe or Axis, the sources said. Munich Re or Allianz SE are also potential buyers, the sources added. Axis and PartnerRe declined to comment, MunichRe and Allianz did not immediately respond to a request for comment.

Crop insurance helps farmers protect themselves from financial ruin when drought, disease, freezing temperatures, hail, or wind destroy their crops. About 90 per cent of planted farmland is covered by insurance every year.

A combination of low interest rates and extreme weather such as flooding and drought have combined to make the business unattractive to many financial institutions and companies of late. OneBeacon Insurance Group Ltd and Monsanto Co are among those to have sold their crop insurance arms in recent months.

Banks have been under increased pressure from US regulators to strengthen their balance sheet and take on less risk, and this has also weighed on their ability to participate in the insurance business. Goldman Sachs Group, for example, sold its Global Atlantic Financial Group Ltd insurance unit in 2013.

Wells Fargo now plans to be active in crop insurance through its insurance brokerage arm.

RCIS collects more than $2 billion in premiums annually from farmers. It has more than 4,000 licensed agents