AIA acquiring BEA Life and partnering with BEA on insurance distribution

Imaginechina

AIA Group has announced the formation of an exclusive 15-year strategic "bancassurance" partnership with the Bank of East Asia (BEA) covering Hong Kong and the Chinese mainland, as well as the acquisition of BEA Life, a wholly owned BEA subsidiary.

AIA will pay a total of just over HK$5 billion (US$650 million) for the deal, according to a statement filed with the Hong Kong Stock Exchange. The pan-Asia life insurer will also acquire a closed portfolio of life insurance policies underwritten by Blue Cross (Asia-Pacific) Insurance.

Under the agreement, BEA will distribute AIA’s life insurance and long-term savings products to its retail banking customers on an exclusive basis.

BEA has more than 1.2 million customers in Hong Kong, and is one of the three largest foreign banks on China's mainland in terms of quantity of personal banking branches.

The addition of BEA as a strategic distribution partner strengthens AIA’s competitive advantages across the Guangdong-Hong-Kong-Macau Greater Bay Area, offering huge market potential with a combined population of 72 million, gross domestic product of US$1.7 trillion and growing demand for life and health insurance, according to a statement released on Thursday.

BEA and AIA officials said they are preparing to launch the distribution partnership, and expect the acquisition of BEA Life to be complete by the end of the year, subject to obtaining relevant regulatory approvals.