Investing.com-- AIA Group (HK:1299) posted a 5% decline in its third-quarter value of new business on Friday, as growth slowed from what the company described as exceptionally high level in the same period last year.
The Hong Kong-based insurer's value of new business fell to $1.42 billion on a constant exchange rate basis for the three months ended September 30, down from $1.48 billion a year earlier.
Value of new business measures expected profits from new premiums and serves as an indicator for future growth.
Mainland China, the company's second-largest market for new business sales, recorded a 33% drop in value of new business during the quarter. The decline reflected a high base of comparison from the prior year, when customers accelerated purchases ahead of industry-wide repricing in September last year.
The mainland China business also faced pressure from a double-digit decrease in new business value from its bancassurance segment.
AIA Hong Kong recorded a 3% fall in new business value, affected by strong sales in July last year. The company said some mainland Chinese visitor customers took a wait-and-see approach due to extensive news coverage of offshore investments.
Chinese authorities began imposing a 20% tax on returns from Hong Kong insurance policies held by mainland residents earlier this year.
Still, VONB for the nine months to September grew 5% to $4.63 billion, with AIA clocking growth across all segments except Thailand.
The company also forecast strong momentum in the fourth quarter, and reiterated that it expects to exceed its 9% to 11% operating profit after tax per-share compound annual growth rate target from 2023 to 2026.
AIA shares rose over 5% in Hong Kong trade on Friday, underpinning an over 1% gain in the Hang Seng.
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