FWD Group is acquiring the life insurance unit of Thailand’s Siam Commercial Bank (SCB) for $3 billion, Reuters reported.
The deal is regarded as Southeast Asia’s biggest insurance M&A deal.
The deal paves the way for SCB to distribute FWD’s life insurance products to its customers in Thailand for the next 15 years.
“The future for the Thai market will be exceptionally good, and we want to be part of this market,” Huynh Thanh Phong, FWD’s chief executive told the Financial Times.
Southeast Asia’s insurance sector continues to attract foreign insurers with its lower insurance penetration levels and faster growth rates for life insurance premiums compared to home markets.
FWD continues its aggressive push into life insurance across Asia. According to the Financial Times, the group said it was buying MetLife’s Hong Kong life insurance business for less than $400 million.
‘It’s not easy to find the right partner that ticks all the right boxes, but finally, we have found one,” Vichit Suraphongchai, SCB’s chairman told the media.
According to him, SCB was searching for a long-term insurance partner that could help take their business to the next level and FWD provides the perfect opportunity.
SCB is currently Thailand’s largest bank in terms of asset and market capitalisation. The bank has 16 million customers with Thailand’s total population being 69 million.
SCB Life Assurance ranks behind Muang Thai Life Assurance, Hong Kong-based Thai Life Insurance, and Krungthai-AXA Life when it comes to market share.
In 2013, FWD entered the insurance business in Asia by acquiring ING Group’s insurance business in Hong Kong, Macao, and Thailand. The group has also expanded in other Asian markets such as Indonesia, the Philippines, Singapore, Vietnam, and Japan.