SINGAPORE – Prudential reported a 43 per cent rise in new business profit to US$3.1 billion (S$4.2 billion) for the financial year (FY) ending in December 2023, compared with US$2.2 billion a year earlier.

On a constant exchange rate basis, the new business profit would be up 45 per cent. Excluding the effect of interest rate and other economic movements, new business profit was up 47 per cent, based on its financials released on March 20.

This was led by the Hong Kong market, in particular after the reopening of the border between Hong Kong and the Chinese mainland and the consequential rebound of annual premium equivalent (APE) sales, said the Asia-focused insurer.

The new business profit for health and protection products increased 34 per cent year on year, while that for savings products grew by 54 per cent.

“This was underpinned by a 37 per cent growth in APE sales, which in absolute terms exceeded the pre-pandemic level of 2019,” Prudential said.

It highlighted new business profit growth in 17 of its 22 life markets, and an increased market share in seven of its Asian life markets.

The agency channel delivered new business profit of US$2.1 billion, up 75 per cent year on year, which reflects both a 67 per cent growth in APE sales and effects of a favourable business mix.

Bancassurance new business profit fell 8 per cent to US$793 million, primarily owing to challenging market conditions in China and Vietnam. The insurer said APE sales through the bancassurance channel, however, increased 3 per cent year on year, supported by growth in Hong Kong and Taiwan.

“Hong Kong was a significant contributor to growth, accounting for 45 per cent of new business profits in the period – both its new business profit and APE sales grew by over three times the prior year’s level,” said Prudential.

“We see an opportunity for sustained growth in Hong Kong as the drivers of demand from domestic and Chinese mainland visitors remain intact.”

Prudential’s chief executive Anil Wadhwani noted that sales growth continued in the first two months of 2024 and the group is confident about achieving its 2027 financial and strategic objectives.

The group directors approved a second interim dividend of 14.21 US cents a share. This brought its full-year dividend to 20.47 US cents a share, up 9 per cent compared with FY2022.

Shares of Prudential closed flat at US$9.71 on March 20. THE BUSINESS TIMES