Manulife Hong Kong reports strong growth for fourth quarter and full-year 2017
February 8, 2018
Hong Kong – The Manulife group of companies operating in Hong Kong (“Manulife Hong Kong”) today announced its fourth quarter and full-year 2017 results with strong growth and a number of new records.
Highlights are:
- Annualized premium equivalent (APE) sales:
- Record quarterly APE sales of HK$1.3 billion, up 21% from the fourth quarter of 2016.
- Record full-year APE sales of HK$4.6 billion, up 18% from 2016.
- Premiums and deposits:
- Record quarterly premiums and deposits of HK$18.1 billion, up 39% from the fourth quarter of 2016.
- Record full-year premiums and deposits of HK$64.1 billion, up 44% from 2016.
- Wealth and asset management gross flows:
- Quarterly wealth and asset management gross flows of HK$8.3 billion, up 41% from the fourth quarter of 2016.
- Record full-year wealth and asset management gross flows of HK$30.1 billion, up 48% from 2016.
- New business value (NBV):
- Record quarterly NBV of HK$925 million, up 21% from the fourth quarter of 2016.
- Record full-year NBV of HK$2.7 billion, up 25% from 2016.
- Mandatory Provident Funds (MPF) market share increased to a record-high of 22.5% based on assets under management as at end December 2017 and was 34.4% based on estimated net cash flows for the period from October to December 2017, further cementing its number one MPF scheme sponsor position in the market.
- Agency force: up 7% to 7,725 agents as at end of 2017
“We have finished up 2017 on a high note with significant growth across our individual and group businesses. We have seen strong market demand for both our insurance and wealth products via agency, bancassurance and broker channels,” said Guy Mills, Chief Executive Officer of Manulife Hong Kong. “Among our long list of achievements, I’m particularly proud of our leading position in the MPF market which was further strengthened during the year.”
Manulife Hong Kong’s APE sales in the fourth quarter of 2017 were a new high of HK$1.3 billion, up 21% from HK$1.1 billion in the same quarter of 2016. Full-year APE sales were also a record high of HK$4.6 billion, up 18% from HK$3.8 billion in 2016. The growth during both periods was mainly attributable to the strong sales of recently-launched customer solutions. Both the agency and bank channels experienced double-digit growth.
Total premiums and deposits in the fourth quarter grew to a record of HK$18.1 billion, up 39% from HK$13.0 billion in the same period of 2016, attributable to growth in both insurance and pension sales and higher renewal premiums. Full-year premiums and deposits increased by 44% to another new record of HK$64.1 billion in 2017 from HK$44.3 billion in 2016.
Quarterly wealth and asset management gross flows were up by 41% to HK$8.3 billion from HK$5.8 billion in the fourth quarter of 2016, reflecting strong increases in both retirement and retail businesses across all of its distribution channels. Full-year wealth and asset management gross flows increased to another new high of HK$30.1 billion, up 48% from HK$20.2 billion in 2016, driven by growth in both retail and retirement businesses, including the successful MPF partnership with Standard Chartered Bank.
Quarterly NBV was HK$925 million, a new record high and up 21% from HK$761 million in the fourth quarter of 2016. Full-year NBV of HK$2.7 billion was also a new high, up 25% from HK$2.2 billion in 2016, mainly attributable to higher APE sales during the year. The growth during both periods was driven by robust sales growth and continued strong margins.
“By focusing on the customer, listening to them proactively and using technology to enhance the customer experience, we have successfully launched new products and services that are meeting their needs and eliminating the pain points,” Mr. Mills said. “An example is the claimsimple.hk solution which was launched in early 2018 to allow customers to submit their medical claims online via their mobile devices within one minute. We expect more innovative services will be introduced to the market in the future so that it becomes easier and simpler for our customers to buy and manage their insurance plans and enjoy a better experience.”
About Manulife Hong Kong
Manulife Hong Kong offers a diverse range of protection and wealth products and services to individual and corporate customers via Manulife (International) Limited, Manulife Asset Management (Hong Kong) Limited and Manulife Provident Funds Trust Company Limited, which are members of the Manulife group of companies.
About Manulife
Manulife Financial Corporation is a leading international financial services group that helps people achieve their dreams and aspirations by putting customers' needs first and providing the right advice and solutions. We operate primarily as John Hancock in the United States and Manulife elsewhere. We provide financial advice, insurance, as well as wealth and asset management solutions for individuals, groups and institutions. At the end of 2017, we had approximately 34,000 employees, 73,000 agents, and thousands of distribution partners, serving more than 26 million customers. As of December 31, 2017, we had over C$1.04 trillion (HK$6.48 trillion) in assets under management and administration, and in the previous 12 months we made C$26.7 billion in payments to our customers. Our principal operations are in Asia, Canada and the United States where we have served customers for more than 100 years. With our global headquarters in Toronto, Canada, we trade as 'MFC' on the Toronto, New York, and the Philippine stock exchanges and under '945' in Hong Kong.
Notes:
1 All percentage changes are stated on a year-over-year basis, except for MPF market share.
2 Annualized premium equivalent (APE) sales are presented to provide consistency of scope for NBV disclosures and industry practice. APE sales consist of Insurance sales plus weighted Other Wealth sales, and exclude our Wealth and Asset Management businesses. They comprise 100% of regular premiums/deposits sales and 10% of single premiums/deposits sales, for insurance and other wealth products.
3 Premiums and deposits are the aggregate of (i) general fund premiums, net of reinsurance, reported as premiums on Manulife’s Consolidated Statements of Income, (ii) segregated fund deposits, excluding seed money, (“deposits from policyholders”), (iii) investment contract deposits, (iv) mutual fund deposits, and (v) institutional advisory account deposits.
4 Wealth and asset management gross flows is comprised of fee based business with little or no insurance risk, including retirement, retail and institutional asset management.
5 New Business Value (NBV) is the change in embedded value as a result of sales in the reporting period. NBV is calculated as the present value of shareholders' interests in the expected future distributable earnings on new business, less the present value of the cost of holding capital as calculated under the MCCSR framework in North America, and the local capital requirements in Asia. Investment assumptions are consistent with product pricing, updated to reflect market assumptions consistent with the market environment in the quarter the business was sold. Best estimate fixed income yields are updated quarterly, and long term expected yields for alternative long- duration assets are typically reviewed during the annual review of actuarial assumptions and methods.
6 MPF market shares are measured by scheme sponsor share of asset under management and net cash flows. Source: Table on p. 5 of Mercer MPF Report as at December 29, 2017.
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