Manulife Hong Kong reports strong growth for third quarter and first nine months of 2021
HONG KONG SAR - Media OutReach - 9 November 2021 - The Manulife group of companies operating in Hong Kong ("Manulife Hong Kong") today announced strong financial results for the third quarter and first nine months of 2021, reporting robust growth in core earnings, annualized premium equivalent (APE) sales and new business value (NBV).
- Core earnings of HK$5.3 billion in the first nine months of 2021, up 16% from the same period of 2020, and HK$1.9 billion in 3Q 2021, up 16% from 3Q 2020
- APE sales of HK$4.9 billion in the first nine months of 2021, up 10% from the same period of 2020, and HK$1.7 billion in 3Q 2021, up 12% from 3Q 2020
- NBV of HK$3.5 billion in the first nine months of 2021, up 34% from the same period of 2020, and HK$1.2 billion in 3Q 2021, up 42% from 3Q 2020
Mandatory Provident Funds (MPF) market share
- Manulife was the largest MPF provider with a market share of 26.5% based on assets under management as at September 30, 2021, up 1.9 percentage points from a year ago
- Manulife was also the leader in terms of estimated net cash flows for the period from July 1, 2021 to September 30, 2021 with a market share of 58.2%
- Record-high number of agents at 10,815, up 6% from the prior year quarter
- Agency force remained the key contributor to insurance, annuity and MPF businesses
"We're pleased to report another quarter of strong results with core earnings growth year-on-year in every quarter of the last four years," said Damien Green, Chief Executive Officer of Manulife Hong Kong and Macau. "Both NBV and NBV margins have increased compared with the prior year quarter, reflecting the quality of our insurance business. All distribution channels contributed to the outstanding performance. Our agency force reached a record high in numbers and delivered strong performance in insurance and pension sales. Our other distribution channels also reported significant growth in APE sales as we see continuous demand for our wide range of product offerings across different customer segments."
Year-to-date core earnings grew by 16% to HK$5.3 billion from HK$4.5 billion in the same period last year. Third quarter 2021 core earnings hit a record high at HK$1.9 billion, up 16% from HK$1.6 billion in the previous year quarter. Drivers for the growth included strong in-force growth, higher new business volumes and favourable product mix.
Year-to-date APE sales were HK$4.9 billion, up 10% from HK$4.5 billion in the same period of 2020. Third-quarter 2021 APE sales rose 12% to HK$1.7 billion from HK$1.5 billion in the previous year quarter, reflecting strong growth in Manulife Hong Kong's bank channel, demand from mainland Chinese visitors through its Macau branch, and an expanded agency force.
In the first nine months of 2021, NBV rose 34% to HK$3.5 billion from HK$2.6 billion in the prior year period. Third-quarter 2021 NBV was HK$1.2 billion, an increase of 42% compared with HK$0.9 billion in the prior year quarter, due to higher sales volumes, favourable interest rates and product management actions. Hong Kong's NBV margin was 70.6% in the third quarter, an increase of 14.6 percentage points compared with the prior year quarter.
Manulife Hong Kong has enhanced its health solution offerings by joining hands with Hong Kong Baptist Hospital to provide customers with access to a new and advanced day medical centre starting July 2021. Last month, it also announced the launch of Holistic Professional Medical Support Service and a strategic partnership with CUHK Medical Centre to give customers priority access to specialists in oncology.
In 3Q 2021, the company expanded its footprint in Hong Kong with the opening of the Manulife Prestige Centre in Tsim Sha Tsui to better serve its high-net-worth customers. It has also strengthened its brand presence by becoming a major sponsor of the recently opened Water World Ocean Park.
"Manulife is committed to continued growth and investment in Hong Kong. We recently launched a prominent harbourfront signage at the Great Eagle Centre, and some of our agents will soon move into the Manulife Place in Kowloon East. Next year, we'll celebrate our 125th anniversary in Hong Kong. We're excited to see our investment[s] in Hong Kong help our professional advisors grow their business and make our customers' lives every day better," added Mr. Green.
I. Manulife Hong Kong includes all our Hong Kong businesses including insurance, insurance-based wealth accumulation products, and our wealth and asset management businesses.
ii. All percentage changes are stated on a year-over-year basis, except for MPF market share.
iii. Core earnings for Manulife Hong Kong include insurance and insurance-based wealth accumulation products, and exclude our wealth and asset management businesses. Core earnings is a non-GAAP profitability measure. For full definition of core earnings, see "Performance and Non-GAAP Measures" in Manulife Financial Corporation's 3Q21 Management's Discussion and Analysis.
iv. Annualized premium equivalent ("APE") sales are presented to provide consistency of scope for NBV disclosures and industry practice. APE sales consist of insurance and insurance-based wealth accumulation products, and exclude our wealth and asset management businesses. They comprise 100% of regular premiums/deposits sales and 10% of single premiums/deposits sales.
v. New business value ("NBV") is the change in embedded value as a result of sales in the reporting period. NBV is calculated as the present value of shareholders' interests in expected future distributable earnings, after the cost of capital, on actual new business sold in the period using assumptions that are consistent with the assumptions used in the calculation of embedded value. NBV excludes businesses with immaterial insurance risks, such as Hong Kong's wealth and asset management businesses. NBV is a useful metric to evaluate the value created by Manulife Hong Kong's new business franchise.
vi. MPF market share is measured by share of assets under management and estimated net cash flows by scheme sponsor. Source: Mercer MPF Market Shares Report as at September 30, 2021.
About Manulife Hong Kong
Manulife Hong Kong, through Manulife International Holdings Limited, owns Manulife (International) Limited, Manulife Investment Management (Hong Kong) Limited and Manulife Provident Funds Trust Company Limited. As a member of the Manulife group of companies, Manulife Hong Kong offers a diverse range of protection and wealth products and services to individual and corporate customers in Hong Kong and Macau.
Manulife Financial Corporation is a leading international financial services provider that helps people make their decisions easier and lives better. With our global headquarters in Toronto, Canada, we provide financial advice and insurance, operating as Manulife across Canada, Asia, and Europe, and primarily as John Hancock in the United States. Through Manulife Investment Management, the global brand for our global wealth and asset management segment, we serve individuals, institutions and retirement plan members worldwide. At the end of 2020, we had more than 37,000 employees, over 118,000 agents, and thousands of distribution partners, serving over 30 million customers. As of September 30, 2021, we had CAD$1.4 trillion (HK$8.6 trillion) in assets under management and administration, and in the previous 12 months we made CAD$31.6 billion in payments to our customers.
Our principal operations are in Asia and Canada, and the United States, where we have served customers for more than 155 years. We trade as 'MFC' on the Toronto, New York, and the Philippine stock exchanges and under '945' in Hong Kong. Not all offerings are available in all jurisdictions. For additional information, please visit manulife.com.