Manulife sees big growth in Southeast Asia

For Manulife Financial, the present is Canada and the United States, but the future will increasingly be Southeast Asia, where its insurance business is growing by 30 percent a year with the potential to improve, a senior executive said on Wednesday.
Premium growth in the six ASEAN countries Manulife operates in will benefit from out-sized economic growth in the region, as well as from demographics and expansion into new territories such as Cambodia, Philip Hampden-Smith, general manager of Manulife's Southeast Asian operations, told Reuters.
"Really our business in Southeast Asia, the whole positioning of it is to take advantage of this demographic wave that we have," he said.
The company, Canada's largest insurer and owner of US insurer John Hancock, hopes to mine both growing affluence and underpenetration by insurers in the region. In addition to insurance, Manulife also sells wealth management and banking products.
Manulife first entered Asia in Shanghai in 1897 and has since spread slowly throughout the region, benefiting as the first foreign player in some markets.
In Southeast Asia, the company has a presence in Indonesia, Vietnam, the Philippines, Singapore, Malaysia and Thailand. Last week, the company said it planned to establish operations in Cambodia next year.
In Cambodia, Manulife will be the first foreign player and holder of one of only two licenses, giving it the chance to help create a market in a country of 14 million people.
"My objective in Cambodia is I would like to see a 30, 40, 50 percent share of that market by dint of being the first mover," Hampden-Smith said, adding that market penetration of 1 million people would not be inconceivable.
But while any profit contribution from Cambodia is still years off, the company has plenty to keep it busy in the region.
Last month, the company inked a strategic partnership with Indonesia's PT Bank Danamon that will allow Manulife to sell banking, wealth management and insurance products to the bank's customers starting next year.
"There are about 80 million bank customers in Indonesia, and there are only about 11 million insurance customers," of which Manulife has 2 million as customers, Hampden-Smith said.
Manulife doesn't break out its Southeast Asian division's profit, but its total profit from Asia last year - which also includes Hong Kong, mainland China, Taiwan, and Japan - was C$623 million ($593 million). The company has targeted profit of C$1.5 billion from the continent by 2015.