AIA to start US$1.6 billion stock buyback, new business miss
[HONG KONG] AIA Group said it will start a US$1.6 billion share buyback and reported a 17 per cent growth in new business value last year that missed analyst estimates.
The measure of future profitability of new policies sold rose to US$4.71 billion, from US$4.03 billion a year earlier, the Hong Kong-based insurer said in a statement on Friday. That missed the 19.2 per cent average growth estimate of 15 analyst forecasts compiled by Bloomberg.
Life insurers are seeking to tap asset diversification demands from mainland investors looking for better returns amid China’s slowing growth and low interest rate environment.
Competition for insurance policies sales is intensifying as the company races against rivals including Prudential Plc to peddle products in the region.
“The growth potential for our markets remains strong despite near-term geopolitical and macroeconomic uncertainty,” said chief executive Lee Yuan Siong in the statement.
Factoring in currency fluctuations, AIA’s mainland China unit saw its new business value jumped to US$1.2 billion, a 17 per cent increase, while Hong Kong’s rose to US$1.8 billion, a 23 per cent increase.
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Annualised new premiums jumped 12 per cent to US$8.6 billion on an actual exchange rate basis. The growth rate would have been 14 per cent with the currency impact stripped out.
Thailand saw total new business value grow 14 per cent in 2024, while in Singapore the metric expanded 15 per cent and 9 per cent in Malaysia, factoring in currency fluctuations.
The insurer declared a final dividend of 130.98 Hong Kong cents per share. The new buyback is expected to start as soon as possible and to be finished by the end of 2025. BLOOMBERG
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