Insurance

Fidelity gets first dip in China fund shark tank

5 Jan 2017

Fidelity International is the first foreign asset manager allowed to create onshore funds and sell them to select mainland buyers. It enters a brutally competitive sector hobbled by capital account controls, and it can't sell to retail investors. This is still a strategic win.

Seoul’s top buyout firm dodges missile-shield hit

5 Jan 2017

MBK wanted to sell ING Life Korea for $3 bln. But Chinese buyers fled after a U.S.-South Korea defence pact riled Beijing.  So the private equity group plans to float it. After more than doubling the value of the once-struggling insurer, MBK can still profit nicely.

Driverless cars will be steered by insurers

23 Dec 2016

Who's to blame in a crash when no one's at the wheel: owner, manufacturer, software developer or someone else? And what if two collide? The industry needs answers, even as autonomous vehicles threaten to erode $200 bln a year in U.S. premiums. Expect greater clarity in 2017.

Canada’s busy deal maven both hands-on and not

19 Dec 2016

Prem Watsa has drafted an airtight policy for Fairfax's $4.9 bln offer for Swiss insurer Allied World, keeping close control of his company. Meanwhile BlackBerry, where he is lead director and a big investor, is trying to parlay its smartphone history into hands-off driving.

EU’s de-stressed insurer test is self-defeating

16 Dec 2016

Life insurers look weak in their first stress test since so-called Solvency II reforms. Regulatory carve-outs mean they may not necessarily need capital. But the anonymous nature of the exercise means that investors can't be certain which are the ones to avoid.

Aetna savings undercut wider synergy credibility

13 Dec 2016

The U.S. medical insurer's CEO now says cost cuts following its Humana acquisition are forecast at $3 bln a year, not the original $1.25 bln. Extra efficiencies conveniently help Aetna with its antitrust defense. The big revision should feed skepticism about all such estimates.

IPO bankers unleash steady-as-she-goes sales pitch

12 Dec 2016

Athene's $1.1 bln debut came in the middle of the range and with a 10 pct pop. That may seem mediocre after the recent U.S. market rally. But Wall Street's equity sales teams have had a bad year. Proving they can crank out a textbook deal may be the best advert for a better 2017.

Australian banks can gain from losing insurance

12 Dec 2016

ANZ wants to sell its $3.3 bln life insurance and wealth management unit. Good idea: insurance is a burdensome sideline given today's tough rules on bank capital. Rival NAB has already exited, and Australia's other two big banks would benefit from following suit.

China regulator has healthy fear of goblin raids

8 Dec 2016

The country's top stock regulator startled investors by ranting against "barbarians" and "goblins". It's not just superstition: he's worried about insurers using premiums to fund corporate raids. Plenty of Chinese boardrooms could use a shake-up, but not by ghoulish speculators.

Fosun’s $3 bln U.S. sale is an orderly retreat

6 Dec 2016

Selling U.S. insurer Ironshore is a welcome sign of caution from one of China's most aggressive dealmakers. The deal will shore up Fosun's balance sheet and sharpen its focus on emerging markets. The U.S. will only become tougher for Chinese firms to navigate.

Generali’s cost cuts could go further

23 Nov 2016

Under pressure from low rates and Italian political risk, the insurer wants to boost operating performance. Boss Philippe Donnet is right to slash expenses to help do so. Yet hitting Generali's cost of equity implies cutting more than what is currently planned.

Zurich Insurance overhaul short on big thinking

17 Nov 2016

It's good that the Swiss insurer plans to increase cost-cutting and link dividend payouts to earnings. While the emphasis on capital discipline is laudable, boss Mario Greco has yet to show the kind of strategic revamp investors might have hoped for.

Aegon’s fortunes unhealthily pegged to White House

10 Nov 2016

The Dutch insurer's earnings were helped out by better-than-expected changes to its assumptions. Better still, Treasury yields have spiked as investors assume inflation from President-elect Donald Trump's policies. The flipside of that could be increased volatility.

China Oceanwide buys GE sloppy insurance seconds

24 Oct 2016

The private conglomerate run by Lu Zhiqiang is paying $2.7 bln for U.S. insurer Genworth Financial, which was spun out of the industrial giant and has since wasted away. It is not clear the Chinese buyer has what it takes to turn around Genworth, but the deal puts it on the map.

Dutch insurer tussle could go a number of rounds

5 Oct 2016

NN Group has gone public with a 2.4 bln euro unsolicited bid for domestic peer Delta Lloyd. Insurer mergers make sense, and despite a bolstered capital position, some Delta investors may take the cash. Still, synergy estimates imply NN may have scope to improve its pitch.

Sompo buys $6 bln policy against declining Japan

5 Oct 2016

The Tokyo firm is acquiring U.S.-listed peer Endurance. Japanese insurers' hunger to diversify from a tough home market has sparked a string of big deals, sometimes at crazy prices. A $6.3 bln price tag here looks fairly sane given Endurance's assets and growth prospects.

Anbang IPO is high-profile test for global banks

4 Oct 2016

The Chinese owner of the Waldorf Astoria has rocketed from obscurity to hold nearly $300 bln in assets. Now it is eyeing a Hong Kong offering for a key unit. Investment banks must get comfortable with the ownership and operations of a private group that poses many questions.

Scarcity value in finance fuels bumper Indian IPO

21 Sep 2016

Indian bank ICICI is selling up to $905 mln of shares in its insurance unit. It is the country's biggest listing since 2010. A punchy valuation underscores how investors are willing to pay a premium for the handful of healthy stocks available in India's financial sector.  

Anbang’s deal slowdown sounds unconvincing

7 Sep 2016

The Chinese insurer pledges fewer deals after a $16 bln-plus spree. That seems like a pitch for respectability before a Hong Kong IPO. But the bold, opportunistic group will probably keep finding new distractions to buy. That will be a turn-off for prospective investors.

Obamacare fails to cover U.S. insurers

16 Aug 2016

Aetna is the latest to exit exchanges selling subsidized health plans. The Affordable Care Act is getting more people insured. But private insurers seem unable to make money. System gaming, adverse selection and political gridlock over refining the law risk squeezing them out.