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UPDATE 2-AIA first-half value of new business growth beats expectations
July 26, 2013 / 1:56 AM / 4 years ago

UPDATE 2-AIA first-half value of new business growth beats expectations

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HONG KONG, July 26 (Reuters) - AIA Group Ltd, the world’s fourth-largest insurer by market capitalisation, reported on Friday a forecast-beating 26 percent increase in its value of new business in the first half of the year, buoyed by growth across its markets in Asia.

Value of new business (VONB) measures the projected profits from new policies. The growth in that metric, which Chief Executive Mark Tucker has focused on as an indicator of the company’s success, was particularly strong in Malaysia at 69 percent higher than the same period last year. That represents the group’s successful integration of ING’s former business in the country, bought by AIA in October last year.

AIA also managed a 27 percent increase in new business growth in China at a time when the economy is slowing, a result that the company attributed to improvement in its product mix and an increase in the number of active sales agents on the mainland.

VONB rose to $645 million from $512 million a year earlier, the Hong Kong-based company said. That beat predictions of 21 percent growth, according to the average estimate of three analysts polled by Thomson Reuters. VONB margins fell 1 percentage point to 41.6 percent.

Shares of AIA rose almost 2 percent in early trade before erasing gains to trade down 0.5 percent. The benchmark Hang Seng Index was 0.2 percent lower.

AIA’s shares have risen 18 percent in the year to date, outperforming those of local peers like PICC, Ping An Group and China Life, which have fallen, data from Thomson Reuters StarMine shows. (Reporting by Lawrence White; Editing by Gary Hill and Chris Gallagher)

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