(Bloomberg) — AIA Group Ltd. stated it would begin a $1.6 billion share buyback and reported a 17% progress in new enterprise worth final 12 months that missed analyst estimates.
The measure of future profitability of latest insurance policies bought rose to $4.71 billion, from $4.03 billion a 12 months earlier, the Hong Kong-based insurer stated in an announcement on Friday. That missed the 19.2% common progress estimate of 15 analyst forecasts compiled by Bloomberg.
Life insurers are looking for to faucet asset diversification calls for from mainland traders in search of higher returns amid China’s slowing progress and low rate of interest setting. Competitors for insurance coverage insurance policies gross sales is intensifying as the corporate races towards rivals together with Prudential Plc to hawk merchandise within the area.
The buyback “displays the sturdy momentum within the enterprise,” stated Chief Monetary Officer Garth Jones. The insurer sees recruitment momentum constructing into 2025. “We stay assured within the outlook and we’re very effectively positioned to capitalize on all of the alternatives out there to us,” he stated in a Bloomberg TV interview in Hong Kong.
Factoring in foreign money fluctuations, AIA’s mainland China unit noticed its new enterprise worth jumped to $1.2 billion, a 17% improve, whereas Hong Kong’s rose to $1.8 billion, a 23% improve.
In China, the insurer targets prosperous clients and “the wealthiest elements” of the market, Jones stated. That permits AIA to remain “extra resilient by way of financial cycles.”
Annualized new premiums jumped 12% to $8.6 billion on an precise alternate fee foundation. The expansion fee would have been 14% with the foreign money influence stripped out.
Thailand noticed complete new enterprise worth develop 14% in 2024, whereas in Singapore the metric expanded 15% and 9% in Malaysia, factoring in foreign money fluctuations.
The insurer declared a remaining dividend of 130.98 Hong Kong cents per share. The brand new buyback is anticipated to begin as quickly as attainable and to be completed by the tip of 2025.
(Updates with CFO feedback from Bloomberg TV interview from fourth paragraph)
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