Prudential PLC Prudential Thailand bancassurance partnership (7243G)
March 19 2020 - 3:00AM
UK Regulatory
TIDMPRU
RNS Number : 7243G
Prudential PLC
19 March 2020
PRUDENTIAL THAILAND AND TMB BANK ESTABLISH STRATEGIC
BANCASSURANCE PARTNERSHIP
Acceleration of strategy with addition of a scale life insurance
platform to complement Prudential's strong asset management
position
Prudential Life Assurance (Thailand) Public Company Limited
("Prudential Thailand"), a subsidiary of Prudential plc, is pleased
to announce it has entered into a strategic bancassurance
partnership with TMB Bank Public Company Limited ("TMB") with an
initial term of 15 years to provide Prudential's leading suite of
health and wealth solutions to TMB's large and growing customer
base.
The new agreement significantly expands and extends Prudential's
successful partnership with Thanachart Bank to TMB Bank, which,
following their merger, is the sixth largest bank by deposits and
fourth largest bank by branches in Thailand.
Thailand is the second largest life insurance market and the
largest mutual fund market in ASEAN, and has significant growth
potential. The bancassurance partnership strongly complements
Prudential's top-five market position in the mutual fund market. It
also deepens the strong relationship with TMB established through
Prudential's joint venture asset management partnerships(1), where
Prudential has a 12 per cent share(2) of the Thai mutual fund
market. Together, both partners now have a high-quality platform to
deliver best-in-class, holistic health and wealth solutions to 9
million TMB customers equivalent to 17 per cent of the country's
adult population(3).
The new strategic partnership with TMB enables Prudential
Thailand to achieve the scale and presence in the life insurance
market, consistent with its ambition of being a leading player. It
is also strongly aligned with TMB's own aspirations of being a
partner in its customers' lives in providing a suite of insurance
solutions and digital services.
Nic Nicandrou, Chief Executive of Prudential Corporation Asia ,
said, "We are delighted to enter into a long-term strategic life
insurance partnership with TMB, further complementing our asset
management relationships in Thailand. This partnership combines
TMB's unrivalled local market knowledge and reach with Prudential's
significant expertise in life, health and savings solutions. It
will provide Thais with access to a fast growing and expanding
digital platform and best-in-class holistic solutions to both
protect their families and grow their wealth. We are also delighted
to contribute to Thailand's economic and social development by
investing in local capital markets and by creating significant
employment opportunities."
Piti Tantakasem, Chief Executive of TMB , said, "We look forward
to taking our life insurance business to the next level with
Prudential Thailand, as we provide innovative offerings to
customers across the country. At the heart of this partnership is a
shared commitment to making a difference in our customers' lives by
addressing their unique needs, ultimately enhancing their financial
wellbeing and supporting the country's sustainable
development."
The extended exclusive partnership agreement will commence on 1
January 2021 and until this time the current arrangement with
Thanachart Bank will continue. This agreement requires the novation
of TMB Bank's current bancassurance distribution agreement with
another insurance group. The change in arrangements will cost Thai
Baht 24.5 billion (equivalent to USD 754 million based on exchange
rate at 18 March 2020) which will be paid in two instalments, with
Thai Baht 12.0 billion due in April 2020 and the remainder on 1
January 2021. The funding for this transaction will utilise a
mixture of Prudential Asia's existing resources and Prudential plc
own resources, potentially also including new debt. In line with
the Group's policy, the amounts described above will be capitalised
as an intangible asset representing distribution rights.
Enquiries:
Media Investors/Analysts
+852 9308 7 9
Erin Atan 62 Darwin Lam +852 2918 6348
+44 (0)20 3977
Ee Ching Tan +852 2918 6396 Patrick Bowes 9702
+44 (0)20 3977 + 44 (0)20 3977
Tom Willetts 9760 William Elderkin 9215
About Prudential plc
Prudential plc is an Asia-led portfolio of businesses focused on
structural growth markets. The business helps individuals to
de-risk their lives and deal with their biggest financial concerns
through life and health insurance, and retirement and asset
management solutions. Prudential plc has 20 million customers and
is listed on stock exchanges in London, Hong Kong, Singapore and
New York. Prudential plc is not affiliated in any manner with
Prudential Financial, Inc., a company whose principal place of
business is in the United States of America, nor with the
Prudential Assurance Company, a subsidiary of M&G plc, a
company incorporated in the United Kingdom.
About Prudential in Thailand
Prudential has operated in Thailand for more than 24 years
through Prudential Life Assurance ( Thailand ) Public Company
Limited . Prudential serves more than 1 . 6 million customers in
Thailand and manages more than Thai Baht 112 billion of assets on
their behalf . In 2019 the Thailand business grew IFRS operating
profits by 8 per cent to USD 170 million and Life Weighted Premium
by 8 per cent to USD 619 million .
About TMB / Thanachart Bank
TMB is a market leader in deposits and digital banking while
Thanachart Bank is a market leader in retail lending, particularly
in the auto hire purchase segment where is ranked No.1 in the Thai
market. After the successful merger with Thanachart Bank, TMB's
operational scale has doubled in size with total assets of Thai
Baht 1.9 trillion and is now the 6th largest bank in Thailand. TMB,
together with Thanachart Bank, has a combined branch network of
over 900 branches nationwide and a customer base more than 9
million.
Footnote
Sources: Association of Investment Management Companies,
International Monetary Fund, Swiss Re, United Nations
(1)In December 2019 Eastspring Investments acquired 50.1 per
cent of Thanachart Fund (with Thanachart Bank, a wholly-owned
subsidiary of TMB, holding the remaining 49.9 per cent). In
September 2018 Eastspring acquired a 65 per cent stake in TMB Asset
Management (now known as TMBAM Eastspring).
(2) As at 31 December 2019 with assets under management of Thai
Baht 667 billion (USD 21 billion).
(3) Estimated Thai population aged 20 years and above as at
2020.
As at 31 December 2019.
Life Weighted Premium represents new and renewal regular premium
plus 10 per cent of single premium.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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