Sun Life Financial (SLF) is to acquire the remaining 51% of PT CIMB Sun Life (CSL), a life insurance company in Indonesia, through the purchase of additional shares of CSL from its long-term partner, CIMB Group.
Sun Life Financial intends to integrate CSL’s business under the Sun Life brand with PT Sun Life Financial Indonesia, which is a key step to comply with Indonesia’s single presence policy.
Sun Life Financial Indonesia is also deepening its partnership with CIMB Group through an extended bancassurance arrangement with PT Bank CIMB Niaga Tbk (CIMB Niaga), the fifth largest bank by asset size in Indonesia, as at December 31, 2015.
This arrangement will strengthen distribution capabilities across CIMB Niaga’s 618 branches and strong customer base throughout Indonesia.
Kevin Strain, president of Sun Life Financial Asia, said: "This is an exciting opportunity to deepen and enhance our business in Indonesia, a priority market for our long-term growth in Asia.
"We had anticipated and positioned ourselves well to meet the "single presence" policy, and uniting the businesses in SLF Indonesia will give us even greater ability to serve our customers. This includes more efficient investment in technology, products and brand. We’re also delighted to be strengthening our partnership with CIMB Group, who is also our long-term bancassurance partner in Malaysia."
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These changes will build further on Sun Life Financial’s momentum in Indonesia, increasing its presence across the country.
This is in addition to SLF Indonesia’s previously announced commitment already underway to invest $40m to enhance its agency force, increase online penetration and strengthen its brand presence in the market.
Earlier this year, SLF Indonesia opened three new offices in East Java and in 2015 moved into its expanded headquarters, Menara Sun Life, in Jakarta.
Tengku Dato’ Sri Zafrul Aziz, group chief Executive, CIMB Group, said: "Bancassurance remains a core component of our wealth management proposition and we look forward to strengthening our regional partnership with Sun Life."
The leadership team for the combined business will be led by Elin Waty who will continue as president director, SLF Indonesia, and assume the role of country manager with immediate effect.
Vivien Kusumowardhani will remain president director of CSL until the businesses combine and will then continue to support Sun Life operationally in Indonesia.
The transaction is expected to close by the end of Q3 2016, subject to receipt of regulatory approvals and satisfaction of customary closing conditions.