Prudential H1 profit up 9% on Singapore growth, onshore China remains weak

HONG KONG: Prudential on Wednesday (Aug 28) reported a 9 per cent rise in first-half operating profit, backed by strong policy sales in Singapore, but a slowdown in business in China and Indonesia weighed on overall growth.
The London and Hong Kong dual-listed company posted operating profit of US$1.54 billion for the first six months on a constant exchange rate basis, up from US$1.46 billion in the same period last year.
The annual premium equivalent (APE) sales – a sales volume gauge – of its Singapore operation grew by 17 per cent to US$450 million in the first six months from the same period a year ago, with the city state replacing China onshore to become Prudential’s second largest new sales market.
Top market Hong Kong saw a 7 per cent drop in APE sales to US$955 million, largely due to a high base from a year ago when volume surged on pent-up demand from Chinese visitors buying insurance in Hong Kong after the pandemic.
In Indonesia, APE sales dropped by 25 per cent to US$107 million during the period from a year ago.
The APE sales of its China onshore joint venture Citic-prudential Life Insurance (CPL) dropped by 15 per cent to US$324 million in the first half compared with a year ago.
The weak sales came after Prudential and Citic, which each own 50 per cent of the unit, injected 2.5 billion yuan (US$350.64 million) in cash in December last year.
The performance “was achieved having taken steps to reposition our business in the Chinese Mainland ahead of both regulatory and macro-economic changes”, Chief Executive Anil Wadhwani said in a statement. He did not give details.
The weak growth in the Chinese mainland and concerns around its property sector continue to put downward pressure on interest rates, a factor that could also weigh on the broader Asian region as well as the global economy’s vitality, the insurer said in the statement.