Australian insurer AMP on Sunday said it planned to partner the world’s biggest listed life insurer China Life in pensions and fund management, as it grows its business in Asia.
AMP Limited said it had signed a memorandum of understanding for strategic cooperation with China Life Insurance (Group) Company which outlined asset management and pensions as areas for partnership.
The deal offers “significant potential” for AMP to extend its reach in the world’s fastest growing major economy at a time when China’s private pensions market is expected to hit one trillion dollars (933 billion US) by 2030, it said.
“This announcement represents a significant milestone in the development of our Asian strategy,” chief executive Craig Dunn said in a statement.
“We will work closely with China Life to explore opportunities where we can draw on our areas of strength for mutual benefit.
“The partnership sets a strong foundation for both organisations to cooperate on opportunities in China, Australia and the Asia-Pacific region.”
The size of the potential opportunity for AMP would depend on Chinese regulations and agreement with China Life, the Sydney-based company said.
AMP has pursued growth in asset management over traditional life insurance businesses in Asia. As at 30 June 2009, five percent or close to five billion dollars of its assets under management were sourced from Asia, it said.
Last week the company announced a 12 billion dollar bid for rival financial services group AXA Asia Pacific, saying it was very important strategically for AMP to expand its “advice footprint and our customer breadth”.
Melbourne-based AXA Asia Pacific rejected the offer, which came from its French parent company and major shareholder AXA SA and AMP, saying it significantly undervalued the financial services group.
AMP also has offices in Japan, India, Singapore, Britain and New Zealand.