Prudential’s CEO Anil Wadhwani, who is the British insurer’s first global head to be based in Hong Kong in its 175-year history, pledged to continue using the city as a centre for its expansion programmes in Asia and Africa, after it showed a strong post-Covid recovery.
“Looking ahead, we continue to see strong growth opportunities in Hong Kong to serve the mainland Chinese visitor customers coming into Hong Kong for saving, health and other protection products,” he said.
For sure, Prudential’s business in Hong Kong has thrived at a time when Hong Kong’s life insurance sales to mainland Chinese visitors surged 59-fold in the first half to hit HK$31.9 billion (US$4 billion). Overall new life insurance sales in Hong Kong rose 26 per cent year on year in the first half to HK$103.1 billion, marginally higher than the HK$99.9 billion in the same period of 2019 before the pandemic.
Wadhwani, 55, moved from rival insurer Manulife in February. He is based in Hong Kong in a break from tradition under which the CEO was based in London.
The change occurred as part of Prudential’s recent corporate restructuring under which it shifted its primary focus to providing life and health insurance and asset management services in Asia and Africa. It follows the decision to spin off its UK and European retirement businesses in 2019 and its US retirement arm in 2021.
Prudential, previously headquartered in London with Asia head office in Hong Kong, is now dual-headquartered in both cities, with the CEO based in Hong Kong.
The Prudential CEO’s move to Hong Kong is considered a major achievement for the city’s Chief Executive John Lee Ka-chiu, who vowed last December to convince international insurance companies to set up regional hubs in Hong Kong for regional expansion.
“I am the first CEO in the history of the 175 years of Prudential to be based here, and we have chosen Hong Kong as our home as the city is our flagship business,” Wadhwani said.
Prudential’s growth trajectory has justified the faith the company had in choosing to base its CEO in the city. Since Wadhwani took the helm, Prudential has seen higher business growth in its 24 markets in Asia and Africa.
The group’s overall new business sales in the first nine months were up 40 per cent on year to US$4.42 billion. In the first half, Hong Kong new policy sales rose 218 per cent to US$670 million, as mainland visitors returned after the border reopened between Hong Kong and mainland China in January.
Hong Kong is also close to mainland China, where Prudential and Citic Group have been operating their 50-50 joint venture, Citic Prudential Life, since 2000.
A big pool of insurance talent, sound infrastructure, vibrancy, and the ease of travel across mainland China and to other Asian markets all make “Hong Kong a great destination for us to be based and to expand in the region,” he said.
Hong Kong is Prudential’s largest market in terms of total annual premiums and new business value in the first half of this year, with over 20,000 agents in the city and a bank partnership with Standard Chartered.
Some 23 million travellers visited the city in the first nine months this year, including 18.7 million from mainland China, according to data from the Hong Kong Tourism Board. This is almost 100 times more than a year earlier when travel was brought to a standstill amid the Covid pandemic.
Prudential in June opened its first branch in Macau as part of its latest push in the Greater Bay Area, which is Beijing’s plan to integrate Hong Kong, Macau, and nine mainland cities as an economic powerhouse.
“The addition of the Macau branch has given us a presence in all 11 cities in the Greater Bay Area and a chance for us to capture the exciting opportunities in the development area, where it is expected to have a greater flow of talent, movement of capital and trade across the border.”
Hong Kong is also close to the Asean region and India, which are also core parts of Prudential’s existing businesses. Hong Kong can serve as a base for the insurer to expand into the eight markets in Africa, although these markets currently provide just 2 per cent of new sales value.
“While Africa is small in terms of contribution at the moment, it represents growth opportunities in the medium and longer term,” Wadhwani said.
“The drivers for growth in Asia and Africa are similar in that there is an emerging middle class where we see huge demand for health protection and retirement savings. If we can replicate some of our learning and expertise in the Asian markets to be adopted into the African markets, we would like to find the next Vietnam or the next Philippines in Africa.”
Prudential now operates in eight African markets: Ghana, Kenya, Uganda, Zambia, Nigeria, Cameroon, Côte d’Ivoire and Togo.