AIA Group Ltd’s stock climbed by up to 6% in Hong Kong trading following the release of its first-quarter 2025 (Q1 2025) results, which showed continued growth in new business value and strong demand from mainland Chinese customers purchasing insurance policies in Hong Kong.
The share uptick came despite broader market softness, with the Hang Seng Index declining 0.3% during the session, according to Bloomberg.
The insurer reported US$1.5 billion in value of new business (VONB) for the first quarter, a 13% increase from the same period last year on a constant exchange rate basis.
AIA attributed the performance to robust activity in its Hong Kong operations and rising interest from cross-border policyholders. Annualised new premiums totalled US$2.6 billion, a 7% increase.
AIA’s Hong Kong segment saw a 16% increase in new business value, supported by demand from both local residents and travellers from mainland China seeking offshore insurance solutions.
AIA experienced a 7% drop in VONB in mainland China, attributing the decline to reduced assumptions for long-term investment returns and lower government bond yields. China's 10-year sovereign yield reached record lows at the close of 2024.
The company continued to diversify across Asia, with Singapore and India serving as key growth areas. AIA Singapore reported a 15% rise in new business value for 2024 and a 52% increase in annualised new premiums. The unit’s VONB margin narrowed by 16.8 percentage points, reflecting a strategic pivot toward long-term savings products.
For the full year ending December 2024, AIA posted VONB of US$4.71 billion, up 18%, while embedded value operating profit rose to US$10.03 billion, a 19% per-share increase.
Operating profit after tax reached $6.61 billion, up 12% per share. The insurer reaffirmed its forecast for operating profit per share to grow at a compound annual rate of 9% to 11% from 2023 through 2026.
AIA returned US$6.5 billion to shareholders in 2024 through dividends and share buybacks. The board approved a 10% increase in the final dividend and launched a US$1.6 billion repurchase plan. The group’s capital adequacy ratio stood at 236% at year-end.
Group chief executive and president Lee Yuan Siong said the company is maintaining its growth trajectory through a regionally focused strategy.
“AIA is uniquely well-positioned to capitalise on the long-term structural growth potential in the world’s most attractive market for life and health insurance through the consistent execution of our clear and ambitious strategy. I am confident that AIA’s long-term business prospects remain exceptional. We will continue to strengthen our substantial competitive advantages to capture the opportunities ahead of us and create sustainable value for all our stakeholders,” he said.
