The sale of the life insurance and medical insurance business to AXA Life Insurance Singapore is expected to be completed in the second half of this year following regulatory approval, HSBC said in a statement yesterday.
The deal is part of the bank’s global plan to sell non-core assets and reduce costs, having outlined in 2011 that it aimed to save up to $3.5bn by this year from streamlining its operations. "The sale… represents further progress in the execution of the group’s strategy," HSBC stated.
HSBC also confirmed a ten-year agreement to distribute AXA’s employee benefits products through its bank branches in Singapore.
Glenn Williams, chief executive of AXA Life Singapore, said: “For AXA Singapore, this partnership translates into a doubling of our employee benefits business in terms of gross written premiums and a portfolio expansion of 28% by clients. Our customers are among a number of government-linked companies, multinational corporations and oil & gas companies. This combined portfolio makes us the fourth largest employee benefits solutions provider in Singapore.”
HSBC announced in December last year that it was selling its entire stake in China’s Ping An Insurance (Group) of China to entities owned by Charoen Pokphand Group, in what was described as the bank’s largest divestment in more than 15 years.
Observers said then that the sale was a sign that HSBC intends to focus on banking rather than insurance, with which it has little opportunities for business synergy.
