AIA’s net profit up 89% to US$ 3 b

AIA Group Ltd. announced a strong set of results with net profit jumping 89% to US$ 3,019 million for the year ended 30 November 2012. Annualised New Premium (ANP) grew 9% from $ 2.47 billion in 2011 to $ 2.69 billion.

AIA said that the jump in net profit reflected the growth in operating profit after tax and the significant gains from positive mark-to-market movements in equity investments in 2012 compared with negative movements in 2011.

While ANP saw a growth of 9& – with Singapore (28%), Hong Kong (16%) and Thailand (14%) recording double-digit growth – value of new business (VONB) rose 27% to reach “a new high of $ 1,188 million.” AIA says VONB is its main measure of value creation and all major markets delivered strong double-digit growth in VONB with the exception of Korea.

“Our focus on VONB growth has shifted our product mix towards higher-margin A&H covers and other protection products that typically have lower average ANP case sizes. This was particularly evident in China where ANP growth remained flat as a result of selling more of these protection products and less lower-margin business,” says the report.

Separately, Mark Tucker, Group Chief Executive and President of AIA Group, said that the company had received provisional approval to open a representative office in Myanmar. “It clearly once was a very attractive market and will be again,” he said. AIG had sold its final stake in AIA for some $ 6.45 billion in December last year, marking the end of an association that began in Shanghai in 1919. Tucker had described it as “the beginning of a new era and a very bright future for AIA.”