Mark Tucker, AIA's Group Chief Executive and President, said:
"AIA has made a very positive start to 2016 with excellent VONB growth of 44 per cent. Our record first quarter VONB of US$578 million is the direct result of our resilient and highly-diversified business model, the quality of our operating performance and the continued execution of our strategy. Our focus remains on executing our strategic priorities by increasing the reach and professionalism of our proprietary agency and partnership distribution channels, further expanding and improving our range of products and raising the quality of services that our customers receive.
"AIA remains exceptionally well-positioned to benefit directly from the fundamental social, demographic and economic changes taking place in our region. We are deeply committed to helping millions of people around the region live longer, healthier lives and plan for a brighter future by meeting their substantial and growing savings and protection needs.
"Through the continued successful execution of our growth strategy and our commitment to building a sustainable business for the long term, we have delivered a very strong track record of year-on-year growth against a global backdrop of volatile capital and currency markets. We remain confident in the future prospects for AIA and the significant growth opportunities we have to provide attractive products and services to our customers and to generate sustainable value for our shareholders."
Summary for the first quater
VONB increased by 44 per cent compared with the first quarter of 2015 to US$578 million.
The successful execution of our differentiated strategy in China has once again delivered excellent VONB growth. Our focus on meeting the substantial and growing protection gap through our Premier Agency strategy has produced a combination of increased active agent numbers, higher agent productivity levels and a high-quality product mix that underpins the sustainability of our growth.
Our Hong Kong business also delivered another outstanding quarter benefiting from both strong growth in the domestic market and a significant positive uplift in new business from mainland Chinese customers.
Malaysia continued its strong momentum to deliver another excellent performance with double-digit growth in VONB from a combination of higher agent productivity and our strategy of focusing on regular premium unit-linked sales combined with increasing levels of protection cover. Singapore growth was more muted with increased regular premium protection business partially offset by lower single premium volumes. Thailand delivered VONB growth from further margin expansion, while Korea continued to face challenging market conditions. Our Other Markets segment also delivered double-digit VONB growth compared with the first quarter of 2015.
VONB margin grew by 4.8 pps to 51.6 per cent from 46.8 per cent in the first quarter of 2015 with the increase mainly from a positive shift in geographical mix, channel mix and others. Economic assumptions remain unchanged for the quarter from those shown in our Annual Report 2015.
ANP grew by 31 per cent compared with the first quarter of 2015 to US$1,103 million reflecting a significant improvement in active agent productivity, increased active agent numbers and a strong performance in our partnership distribution channel.
TWPI increased by 13 per cent to US$5,040 million compared with the first quarter of 2015.
Asian economies remain resilient with a gradual and ongoing rebalancing in favour of domestic consumption in Asia's emerging markets and with significant latitude for authorities to adjust monetary and fiscal policy. The substantial long-term structural growth drivers of our markets remain intact despite global capital market volatility in the first quarter.
The Asia-Pacific region remains the most attractive and exciting market in the world for life insurance with the protection gap between the need for life and health insurance and the levels of cover in place continuing to widen. We remain confident that AIA's market-leading businesses, the quality of our proprietary distribution, our financial strength and the consistent execution of our strategy place us in an advantaged position to continue to build on AIA's long and successful history in the region and meet the substantial and growing protection and savings needs of our customers over the long term.
Foreign exchange volatility
AIA receives the vast majority of its premiums in local currencies and we closely match our local assets and liabilities to minimise the economic effects of foreign exchange movements. When reporting the Group's consolidated figures, there is a currency translation effect as we report in US dollars. We have provided growth rates and commentaries on constant exchange rates unless otherwise stated, since this provides a clearer picture of the year-on-year performance of the underlying businesses during the recent period of foreign exchange volatility.
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AIA Group Limited and its subsidiaries (collectively "AIA" or the "Group") comprise the largest independent publicly listed pan-Asian life insurance group. It has a presence in 18 markets in Asia-Pacific – wholly-owned branches and subsidiaries in Hong Kong, Thailand, Singapore, Malaysia, China, Korea, the Philippines, Australia, Indonesia, Taiwan, Vietnam, New Zealand, Macau, Brunei, a 97 per cent subsidiary in Sri Lanka, a 26 per cent joint venture in India and representative offices in Myanmar and Cambodia.
The business that is now AIA was first established in Shanghai almost a century ago. It is a market leader in the Asia-Pacific region (ex-Japan) based on life insurance premiums and holds leading positions across the majority of its markets. It had total assets of US$168 billion as of 30 November 2015.
AIA meets the long-term savings and protection needs of individuals by offering a range of products and services including life insurance, accident and health insurance and savings plans. The Group also provides employee benefits, credit life and pension services to corporate clients. Through an extensive network of agents, partners and employees across Asia-Pacific, AIA serves the holders of more than 29 million individual policies and over 16 million participating members of group insurance schemes.
AIA Group Limited is listed on the Main Board of The Stock Exchange of Hong Kong Limited under the stock code "1299" with American Depositary Receipts (Level 1) traded on the over-the-counter market (ticker symbol: "AAGIY").