DBS and Manulife form 15-year life bancassurance partnership

The agreement will take effect on 1 January 2016. This new exclusive life bancassurance partnership will combine DBS’ superior Asian banking franchise with the insurance and wealth management expertise of Manulife, a global leader with a long-term commitment to Asia.

In the four markets, DBS’ large and growing six million retail, wealth and small and medium sized enterprise (SME) customer base will gain access to Manulife’s best-in-class suite of life and health insurance solutions, through the bank’s extensive network of over 200 branches and its sales force of over 2,000 professionals, as well as via its internet and mobile banking platforms.

Leading to the agreement with Manulife, DBS conducted a thorough insurance partner selection process, which attracted strong interest from a number of leading regional and multinational insurers. The process considered a number of factors, including customer focus, expertise, execution track record and potential for long term value creation.

The partnership is expected to bring significant benefits to both parties. Specifically, DBS will further strengthen its regional life insurance distribution capabilities, including its position as a leading bancassurer in Singapore, while providing its customers with a full suite of innovative and customised insurance solutions. Manulife will gain exclusive access to DBS customers in four highly attractive insurance markets, which remain significantly under-insured with a sizeable insurance protection gap and underfunded retirement needs.

Piyush Gupta, chief executive officer (CEO) of DBS said: “Bancassurance is a key focus for DBS and an important part of our overall customer value proposition. Manulife’s strong customer focus and deep commitment to Asia are aligned with our own vision. We are already working with Manulife in Singapore, Hong Kong and Indonesia, and will soon be their flagship regional bancassurance partner and their largest bancassurance partner globally. Together, we look forward to building upon the momentum we have achieved in bancassurance.”

Donald A. Guloien, president and CEO of Manulife said that Manulife was delighted to be chosen as the bancassurance partner of DBS in four important markets in Asia. “We know DBS well, and want to be an integral part of their continued success as a leading financial services group in Asia. This 15-year agreement builds on our existing successful relationship with DBS. It accelerates our growth in Asia, deepens and diversifies our insurance business, and gives us access to a much wider range of customers,” added Guloien.

Under the agreement, there will be an initial payment by Manulife to DBS of $1.2 billion, which Manulife intends to fund with internal resources. This payment will be amortised by both parties over 15 years. There will also be ongoing, variable payments, which are based on the success of the partnership, and Manulife expects the agreement to be accretive to Core EPS in 2017. The initial payment for this regional agreement is expected to reduce Manulife’s regulatory capital ratio by 10 points on or before January 1, 2016.

DBS is a leading financial services group in Asia, with over 250 branches across 17 markets. Headquartered and listed in Singapore, DBS has a growing presence in the three key Asian axes of growth: greater China, Southeast Asia and South Asia.

Manulife is a leading provider of insurance and wealth management solutions. It is the sixth largest life insurer in the world, with a 118-year track record in Asia, and more than six million customers across 12 markets in the region. Manulife first established a presence in Singapore in 1898 and is the leading life insurance provider of retirement and wealth solutions in Hong Kong, where it established operations in 1897. Manulife is a leading Canada-based financial services group with principal operations in Asia, Canada and the United States.