AIA Group has agreed to acquire 100% of the wholly owned life subsidiary of Bank of East Asia (BEA) and the legacy portfolio of policies underwritten by Blue Cross (Asia Pacific) Insurance.
The acquisition of BEA Life is expected to complete by the end of this year, subject to receiving all relevant regulatory approvals, including the Hong Kong Insurance Authority and, in respect of the portfolio transfer, the sanction of the Hong Kong Court.
As part of the deal, the Bank of East Asia has signed a 15-year exclusive bancassurance partnership with AIA Group, covering Hong Kong and mainland China.
The agreement provides AIA with access to BEA’s personal banking customer base. BEA will distribute AIA’s protection and long-term savings product solutions for the bank’s retail customer segments.
AIA will pay BEA a total of HK$5.07bn (£480m, $650m, €550m), covering both the acquisition of BEA Life as well as the 15-year bancassurance partnership for life and long-term savings insurance solutions.
The two firms will immediately begin preparations to launch the distribution partnership.
‘Unlock significant growth’
Adrian Li and Brian Li, co-chief executives of BEA, said: “Our strategy is to drive sustainable income by providing our customers with a compelling range of competitive products through our best-in-class omni-channel bank distribution network.
“AIA has an extraordinary track record in bancassurance and a deep commitment to the Greater Bay Area (GBA). We look forward to working together in building a leading life insurance sales platform in Hong Kong and mainland China, focused on serving the future needs of the GBA.”
Jacky Chan, AIA’s regional chief executive, said: “This transaction brings together two trusted financial institutions with a long history of operating in Hong Kong and mainland China, who are aligned in the pursuit of sustainable growth powered by digital and technological transformation.
“It enables us to bring our in-branch sales expertise and range of quality protection and long-term savings products to BEA’s loyal customer base, with an opportunity to unlock significant growth potential for both companies.
“Our complementary and broad capabilities across the Greater Bay Area enable AIA and BEA to build a unique partnership and harness the growth potential as the region develops.”