Great Eastern's Q4 profit more than doubles to S$424m; eyes growth in Indonesia

The insurance arm of OCBC Bank will give out total dividends of 70 cents this year, up from 50 cents last year. PHOTO: ST FILE

SINGAPORE - Insurer Great Eastern is looking to expand its footprint in Indonesia and expects to be among the top 10 in the next five years in Southeast Asia's largest country.

"I think top 10 would be a good aspiration for us," said its group chief executive officer, Khor Hock Seng, during a results briefing on Tuesday (Feb 13).

The expansion will likely come through the bancassurance channels offered by OCBC's distribution network in Indonesia, as well as through other partnerships with banks there.

The group's net profit more than doubled to S$423.6 million for the fourth quarter of 2017 on stronger insurance sales, as well as gains from the sale of investments and changes in fair value, the insurance arm of OCBC bank announced on Tuesday.

On a per share basis, Great Eastern's profit attributable to shareholders rose to 89 Singapore cents for the three months ended Dec 31, up from 42 Singapore cents in the year-ago period.

For the full year, the group's net profit surged to S$1.16 billion for the fiscal year 2017, from S$589.3 million the previous year.

Operating profit from Great Eastern's insurance business also rose 37 per cent to S$156.1 million for the quarter, and 19 per cent to S$598.7 million for the year.

In addition, the group's total weighted new sales grew 36 per cent to S$471.7 million for the quarter, driven by increased contributions from Singapore across both agency and bancassurance channels, the company said.

Meanwhile, the group's new business embedded value, a measure of long-term economic profitability, rose 35 per cent to S$204.4 million for the three months ended Dec 31.

Commenting on the group's financial results for fiscal year 2017, Mr Khor said: "The Great Eastern Group delivered a strong set of results on all fronts. In Singapore... the strong contributions from agency stemmed from a significant increase in productivity, as well as our success in recruiting 800 new representatives."

He added that the group has built a strong foundation that will position them to "deliver profitable growth and long-term sustainable value" for shareholders.

The board has recommended a final dividend of 50 Singapore cents per ordinary share, up from 40 Singapore cents last year, and a special dividend of 10 Singapore cents per ordinary share.

Including the interim dividend of 10 Singapore cents per share paid in August 2017, total dividends for fiscal 2017 would amount to 70 Singapore cents, up from 50 Singapore cents for fiscal 2016.

Great Eastern shares ended 1.3 per cent higher at S$29.37.

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