Ageas and EastWest Bank establish a life insurance joint venture (JV) in the Philippines

The JV called "EastWest Ageas Life" will be a start-up company in which Ageas and EastWest Bank will both have an equal  shareholding of 50%^1. It was further agreed that EastWest Bank and EastWest Ageas Life will enter into a 20-year exclusive distribution agreement.

The ambition is to build the premier bancassurance business in the Philippines offering tailor-made insurance solutions to the customers of EastWest Bank supported by high quality service and state-of-art technology. The insurance business will benefit from EastWest Bank's fast growing customer base. With more than 400 branch stores, the bank has the 7th largest distribution network amongst banks in the Philippines. Ageas will contribute its proven bancassurance skills and best practices from its successful businesses in Asia and Europe.

Tony C. Moncupa Jr., President and CEO of EastWest Bank commented: "We have always viewed bancassurance as an integral part of our business model. We see it as a necessary ingredient to have complete product offerings for the financial services needs of our target market segments. Specifically, the consumer and middle market corporate segments. We are pleased to partner with Ageas, one of the major insurance providers in the world. In Ageas, we are comfortable that we have a common set of objectives and aligned philosophy on how to best serve our customers. For us in EastWest Bank, alignment is most important and it is the reason why we both agreed to enter into a JV and a long-term exclusive distribution agreement for the JV's life insurance products. We are confident this partnership will help EastWest Bank to continue to be among the fastest growing banks in the country."

Gary Crist, CEO of Ageas Asia commented: "As part of our Asia strategy, we have made no secret that we wish to enter the Philippines as the insurance market is highly attractive with a population of around 100 million people, a fast growing middle class and low insurance penetration. The potential is huge given that the current Life insurance penetration rate of around 1.5% is one of the lowest in Asia. We are very pleased to be a partner to EastWest Bank which has a strong management and clear ambition to grow. We are convinced that together we can deliver another successful partnership in Asia."

Under the agreement, Ageas will contribute capital and funding in the initial 12 months for an estimated amount of USD 65 million or EUR 60 million (PHP 2,910 million)². The initial capital injection amounts to USD 45 million or EUR 41 million (PHP 2,010 million) which is double the minimum regulatory capital required. Future funding will be dependent on the performance of the business.

Subject to regulatory approvals, the transaction is expected to be completed in the second half of the year and EastWest Ageas Life is expected to commence operations in 2015.

¹ Actual shareholding structure: Ageas holds 50% plus one share and EastWest Bank holds 50% minus one share.
² In local currency the initial capital and funding amounts to PHP 2,910 million and is converted to USD at an exchange rate of 0.0224  and to EUR at a rate of 0.0205 (Exchange rates of 26 May 2015).

EastWest Banking Corporation is one of the fastest growing universal banks and is ranked among the top 10 privately owned local banks in the Philippines. It is a subsidiary of the Filinvest Development Corporation (FDC), one of the largest and well established business conglomerates in the Philippines. FDC, established in 1955, is identified with the Gotianun family and aside from banking, its business interests include real estate, sugar, hospitality & tourism, and power generation.

Ageas is an international insurance group with a heritage spanning 190 years. Ranked among the top 20 insurance companies in Europe, Ageas has chosen to concentrate its business activities in Europe and Asia, which together make up the largest share of the global insurance market. These are grouped around four segments: Belgium, United Kingdom, Continental Europe and Asia and served through a combination of wholly owned subsidiaries and partnerships with strong financial institutions and key distributors around the world. Ageas operates successful partnerships in Belgium, the UK, Luxembourg, Italy, Portugal, Turkey, China, Malaysia, India and Thailand and has subsidiaries in France, Hong Kong and the UK. Ageas is the market leader in Belgium for individual life and employee benefits, as well as a leading Non-Life player through AG Insurance. In the UK, Ageas is the sixth largest Non-Life insurer with a number 3 position in cars insured and has a strong presence in the over 50's market. Ageas employs more than 13,000 people in the consolidated entities and over 30,000 in the non-consolidated partnerships, and has annual inflows of more than EUR 25 billion.