OCBC Bank announced on Friday (Dec 27) that it has sold its entire 33.33% stake in Hong Kong Life to Chinese investment holding company Yue Xiu Enterprises.
Hong Kong Life Insurance had a net asset value of HK$1.02bn (US$131.9 million) as at the end of last year, with consideration for sale shares at HK$589.3 million, OCBC said in a media release. The consideration had been arrived at following independent negotiations between OCBC’s Hong Kong branch and Yue Xiu Enterprises, and took into consideration the net asset value and embedded value of Hong Kong Life.
Upon completion of sale, Hong Kong Life will cease to be an associated company of OCBC Hong Kong and OCBC Bank.
OCBC said that the transaction is not expected to have a material impact on its net tangible assets or earnings per share for the 2024 financial year.
Established in 2001, Hong Kong Life was founded by a joint venture between five Hong Kong financial institutions, including Asia Insurance, Chong Hing Bank, CMB Wing Lung, OCBC Hong Kong and Shanghai Commercial Bank.
Hong Kong Life has experienced significant growth over the last three quarters in total accumulated premiums, according to a (Re)in Asia analysis of Hong Kong Insurance Authority data. The firm reached HKD $175 million in total accumulated new business premiums in Q2 2024, driven by a large spike of single revenue premiums in that quarter.
It ranked 5th in new life insurance business by year-on-year growth in Q2 2024, according to a (Re)in Asia analysis, with 137.71% growth in total accumulated premiums. The life insurer also ranked top in single revenue premium growth year on year, with 2,798% growth.
