Marking a significant change in the Philippines’ bancassurance
landscape, Philippine American Life and General Insurance Company
(Philamlife), the country’s largest life insurer, is to acquire a
51 percent stake in Ayala Life from Bank of the Philippine Islands
(BPI). According to local media reports, Philamlife will pay
PHP1.35 billion ($28 million) for its stake in Ayala Life, the
country’s seventh-largest life insurer.
The move marks a notable change in fortune for Philamlife which
a year ago found itself the potential prey with bidders reputed to
have included BPI with which it is now forming a bancassurance
partnership. BPI, the Philippines’ third-largest commercial bank,
will provide Philamlife with access to BPI’s 3 million customers
and network of over 800 branches.
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Ayala Life put in an impressive showing in the first seven months
of 2009, reporting that strong bancassurance sales had enabled it
to generate gross premium income (GPI) of PHP2.6billion, up 140
percent compared with the same period in 2008. Ayala Life reported
GPI of PHP1.8 billion for 2008 as a whole.
Ayala Life’s GPI in 2008 was a tenth of the PHP17.9 billion
reported by Philamlife while its total assets at the end of 2008
stood at PHP11.5 billion.
Philamlife, a unit of American International Group (AIG), is
currently being incorporated into American International Assurance
Company (AIA), AIG’s major Asian life insurance unit.
AIA is being lined up by AIG for an initial public offering on an
Asian stock exchange, a development aimed at accelerating its
assumption of an independent identity.
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