HSBC said that it has entered into an agreement to acquire 100% of AXA Insurance issued share capital in Singapore for US$575 million.
The intention of this deal is to merge the operations of HSBC Life Singapore and AXA Singapore, which is subject to further approval by the Singapore regulator and courts.
The bank said that this is a key step in its “ambition of becoming a leading wealth manager in Asia, by expanding its insurance and wealth franchise in Singapore, a strategically important scale market for HSBC, and a major hub for its ASEAN wealth business”.
HSBC added that AXA Singapore is a good fit with its existing HSBC Insurance (Singapore) business.
Both businesses have complementary products across the spectrum of insurance solutions and distribution channels, while AXA Singapore provides access to a sizeable tied-agency sales force, several leading independent financial advisory firms, and a large pool of insurance policyholders and corporate relationships.
This combined business will not only materially scale up HSBC’s presence in the regional insurance market, it will also provide an excellent platform for future growth.
The combined business would reportedly be the 7th largest life insurer based on annualised new premiums and 4th largest retail health insurer based on gross premiums with over 600,000 policies in-force covering life, health and P&C.
Noel Quinn, Group Chief Executive, HSBC Holdings commented,
“This is an important acquisition that demonstrates our ambition to grow our wealth business across Asia. Wealth is one of our highest growth and highest return opportunities, and plays to our strengths as an Asia-centred bank with global reach.
We are acquiring a good business that fits well with our existing operations, and which strengthens our status as one of Asia’s leading wealth and insurance providers.”
Nuno Matos, Chief Executive, Wealth and Personal Banking at HSBC added,
“This strategic investment is a key milestone for HSBC Life to materially scale up, grow and diversify our insurance and wealth business in Singapore.
The proposed acquisition will immediately put us in a leading position in health and employee benefits, and accelerate our build out of a distinctive and holistic wealth and health planning business, operating beyond our branch network.”
