HONG KONG-Hong Kong life insurance giant AIA group said on March 15 its new sales and service centers in northern Chinese cities of Tianjin and Shijiazhuang would be ready within the year. This comes as the central government plans to further open up the mainland’s insurance sector to overseas participation.
“Preparations are now in process. We will go and look for the office and get the people we need in four to six months,” Ng Keng-hooi, chief executive and president of the company, told reporters when releasing the latest annual results.
The insurer received approval from the China Banking and Insurance Regulatory Commission for the establishment of the two new centers last month. This is in accordance with the existing regulatory policy and a pilot program promoting insurance integration under the Beijing-Tianjin-Hebei Integration Plan.
The central government plans to allow 100 percent overseas-owned insurance companies to operate throughout the country in 2021. As the first overseas insurer to be granted a license on the Chinese mainland almost 100 years ago, AIA already occupies 30 percent of the mainland market, Ng explained.
He said the company would watch the central government’s policy closely and establish businesses in more cities.
AIA reported stronger than expected new business growth both in mainland and Hong Kong markets last year. The company posted a 22 percent increase in new business value – a key growth metric for insurers which indicates profitability – to $3.96 billion for the 13 months ending Dec 31 last year.
AIA has changed its financial year-end date from Nov 30 to Dec 31.
New business value in the mainland market grew 30 percent to $965 million - making it the fastest growing sector. Hong Kong remains the bulk of AIA’s new business - reporting a 24 percent rise to $1,712 million last year. New annual premiums surged 15 percent to $6.51 billion.
With volatile financial markets last year, the company’s net profit for the 13 months plunged 60 percent to $2.6 billion - worse than market expectations. The insurer explained that the decrease was mainly due to the negative short-term fluctuations from equities and real estate of $2.06 billion.
As its financial year-end date has changed, the company declared a special dividend of 9.50 Hong Kong cents per share - lifting its final dividend payout by 14 percent.
AIA shares fell 0.32 percent to close at HK$78.5 on March 15 after the company released its annual report.
Copyright 1995 - 2019. All rights reserved. The content (including but not limited to text, photo, multimedia information, etc) published in this site belongs to China Daily. Without written authorization from China Daily, such content shall not be republished or used in any form.
HONG KONG NEWS