The pan-Asian insurance giant American International Assurance (AIA) has issued stronger-than-expected financial results for the first half of 2011. The Hong Kong-listed insurance company last week reported that net profit for the first six months of its fiscal year had increased by nearly a quarter due to increased agent productivity and the continued success of its insurance business in major markets in Asia, a trend expected to continue AFP.
In a company statement released Friday, AIA confirmed an increase of 24 percent net profit, U.S. $ 1.06 billion to U.S. $ 1.31 billion during the first six months of 2011 ending May 31. AIA attributes these positive results in large part to new entrants of its life insurance operations in more developed economies of Asia, which grew 32 percent to U.S. U.S. $ 399 million$ 303 million for the same period last year. The total annualized premium of these new companies in turn, increased by 23 percent to U.S. $ 1090 million.
AIA has credited much of this success to the continued development and improvement of the modeling agency in the insurance markets of Asia large operating in. The company said it had increased the number of active agents by 9 percent during the first half of the year and therefore had seen a 17 percent increase in productivity per agent since 2010. AFP in turn has been the introduction of higher margin traditional policies of life insurance, health and accident in these major markets and promotion of agents also sell more pilots and additional products to these people with new wealth. According to AFP, an agency linked to the force was responsible for 78 percent of new business insurance group and 72 percent of total new group's annual premiums in the first half of 2011.
The insurer has also worked hard this year to cultivate relationships with member banks and improve its bancassurance and alternative distribution platforms, direct marketing, which currently has 25 percent of the company's business. AIA has established partnerships with several regional bancassurance companies, including Australia and New Zealand Australia Bank and Citibank, which operate a total of 14 major markets in Asia. The insurer has been able to then, both the updated value of sales and increased operations banacassurance by adjusting prices and re-sold products through its banking partners. According to AFP, these measures have helped to grow bancassurance as much as 18 percent during this period.
Down more specifically in the market by market, the value of the backlog of AFP in China grew 47 percent in the first half of the U.S. $ 44 million, while Hong Kong rose 27 percent to U.S. $ 121 million, Singapore and Thailand and published more than 50 percent, U.S. growth rates U.S. $ 78 million $ 101 million in new business during the first six months of 2011, respectively. China has become the group's third-largest driver of growth.
Cumulatively, AIA said its net premiums and fee income for the period increased by 13 percent to U.S. $ 5.78 billion. Operating profit after tax for its part the U.S. increased by 8 points $ 967 million, U.S. $ 899 million in the first half of 2010. As a result of these positive figures that consistently exceeded market estimates, the insurer announced it would pay HK $ 0.11 per share dividend of half a year. The company would finance the payment of dividends from operating cash flow generated from ongoing business of the group representing approximately one third of the full-year 2011 dividends declared by the AIA.
This would pay dividends for the first time since it was first included in Hong Kong on October 29 last year, when record profits AIA raised HK $ 138.33 billion international placement of their new shares, which was world's third largest IPO in time. Meanwhile, the share price of AFP increased 4.7 percent to a record HK $ 29 per share in early trading Friday, before retreating to HK $ 28.55, or 3.4 percent above, in short, is still around 45 percent over the HK $ 19.68 price of the IPO. Confidence in the AIA has been maintained, with increased investment income by 17 percent to U.S. $ 2040 million despite continued volatility in global capital markets.
CEO and President of the AIA, Mark Tucker, said at a news conference that the dividend payment was demonstrative of the strong cash flow inherent in the business of AIA. The company now has a solvency ratio above 356 per cent, equivalent to about U.S. $ 5 million in reserves. "We are confident in our ability to maintain a prudent and progressive dividend, besides being able to self-finance our strong new business growth," said Tucker.
Asia promising long-term economic forecasts, along with the region's demographic trends continue to drive demand AFP savings fund and protection products. The insurer has had a limited exposure to the problems of sovereign debt of the United States in Europe and has suggested that most of the investments of the company is based in Asia in order to match assets and liabilities at local. Mr. Tucker concluded that there might be more to come as the insurance giant aims to close the gap of one trillion dollars in coverage between the East and West. "The scale of our franchise, our financial strength, our agents and motivated staff, innovative products and pan-regional experience are some of the competitive advantages that can be implemented to create value from this opportunity in Asia. We are very confident about AFP continued growth in Asia. "
In a company statement released Friday, AIA confirmed an increase of 24 percent net profit, U.S. $ 1.06 billion to U.S. $ 1.31 billion during the first six months of 2011 ending May 31. AIA attributes these positive results in large part to new entrants of its life insurance operations in more developed economies of Asia, which grew 32 percent to U.S. U.S. $ 399 million$ 303 million for the same period last year. The total annualized premium of these new companies in turn, increased by 23 percent to U.S. $ 1090 million.
AIA has credited much of this success to the continued development and improvement of the modeling agency in the insurance markets of Asia large operating in. The company said it had increased the number of active agents by 9 percent during the first half of the year and therefore had seen a 17 percent increase in productivity per agent since 2010. AFP in turn has been the introduction of higher margin traditional policies of life insurance, health and accident in these major markets and promotion of agents also sell more pilots and additional products to these people with new wealth. According to AFP, an agency linked to the force was responsible for 78 percent of new business insurance group and 72 percent of total new group's annual premiums in the first half of 2011.
The insurer has also worked hard this year to cultivate relationships with member banks and improve its bancassurance and alternative distribution platforms, direct marketing, which currently has 25 percent of the company's business. AIA has established partnerships with several regional bancassurance companies, including Australia and New Zealand Australia Bank and Citibank, which operate a total of 14 major markets in Asia. The insurer has been able to then, both the updated value of sales and increased operations banacassurance by adjusting prices and re-sold products through its banking partners. According to AFP, these measures have helped to grow bancassurance as much as 18 percent during this period.
Down more specifically in the market by market, the value of the backlog of AFP in China grew 47 percent in the first half of the U.S. $ 44 million, while Hong Kong rose 27 percent to U.S. $ 121 million, Singapore and Thailand and published more than 50 percent, U.S. growth rates U.S. $ 78 million $ 101 million in new business during the first six months of 2011, respectively. China has become the group's third-largest driver of growth.
Cumulatively, AIA said its net premiums and fee income for the period increased by 13 percent to U.S. $ 5.78 billion. Operating profit after tax for its part the U.S. increased by 8 points $ 967 million, U.S. $ 899 million in the first half of 2010. As a result of these positive figures that consistently exceeded market estimates, the insurer announced it would pay HK $ 0.11 per share dividend of half a year. The company would finance the payment of dividends from operating cash flow generated from ongoing business of the group representing approximately one third of the full-year 2011 dividends declared by the AIA.
This would pay dividends for the first time since it was first included in Hong Kong on October 29 last year, when record profits AIA raised HK $ 138.33 billion international placement of their new shares, which was world's third largest IPO in time. Meanwhile, the share price of AFP increased 4.7 percent to a record HK $ 29 per share in early trading Friday, before retreating to HK $ 28.55, or 3.4 percent above, in short, is still around 45 percent over the HK $ 19.68 price of the IPO. Confidence in the AIA has been maintained, with increased investment income by 17 percent to U.S. $ 2040 million despite continued volatility in global capital markets.
CEO and President of the AIA, Mark Tucker, said at a news conference that the dividend payment was demonstrative of the strong cash flow inherent in the business of AIA. The company now has a solvency ratio above 356 per cent, equivalent to about U.S. $ 5 million in reserves. "We are confident in our ability to maintain a prudent and progressive dividend, besides being able to self-finance our strong new business growth," said Tucker.
Asia promising long-term economic forecasts, along with the region's demographic trends continue to drive demand AFP savings fund and protection products. The insurer has had a limited exposure to the problems of sovereign debt of the United States in Europe and has suggested that most of the investments of the company is based in Asia in order to match assets and liabilities at local. Mr. Tucker concluded that there might be more to come as the insurance giant aims to close the gap of one trillion dollars in coverage between the East and West. "The scale of our franchise, our financial strength, our agents and motivated staff, innovative products and pan-regional experience are some of the competitive advantages that can be implemented to create value from this opportunity in Asia. We are very confident about AFP continued growth in Asia. "
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