INSURANCE provider Great Eastern’s profit for the second half of the year ended Dec 31, 2023, declined 13 per cent to S$337.4 million, from S$385.9 million for H2 2022.
It was mainly led by a 25 per cent higher income tax expense of S$179.2 million, based on the OCBC insurance arm’s financials released on Monday (Feb 26).
Earnings per share for the half-year period stood at S$0.71, down 13 per cent from S$0.82 a year earlier.
The board proposed a final dividend of S$0.40 per share, which will be payable on May 17, upon shareholders’ approval at the annual general meeting on Apr 25. The transfer books and the register of members of Great Eastern will be closed from 5 pm on May 2 up to May 3 to determine the dividend entitlements.
Including the interim dividend of S$0.35 per share paid in August 2023, the total dividend for FY2023 would amount to S$0.75 per share, higher than S$0.65 per share in FY2022.
For FY2023, its profit increased 27 per cent to S$774.6 million, driven by investment performance in the Singapore Life business and shareholders fund. “Profitability of our insurance business is healthy, though dampened by higher medical claims,” said the group.
It also highlighted a steady growth in new customer count, with the total new customer base growing by over 400,000 in the whole year.
Total weighted new sales for the year fell 12 per cent to S$1.7 billion as compared to FY2022, reflecting lower single premium sales in the Singapore market. This was because the inverted Singapore-dollar yield curve made shorter-term interest-yielding investments more appealing than single premium products, Great Eastern noted.
“Lower sales in single premium products were partially offset by growth in regular premium sales, particularly in protection and whole life plans through the group’s core distribution channels.”
The group’s new business embedded value for the year declined 11 per cent to S$762.1 million, led by lower sales on the whole.
Khor Hock Seng, Great Eastern’s group chief executive, noted that the group continues to focus on improving customer experiences and developing new products despite a challenging operating climate in 2023.
He also highlighted the proposed acquisition of AmMetLife Insurance and AmMetLife Takaful in Malaysia, together with the entering of a 20-year exclusive bancassurance and bancatakaful agreement for the distribution of life insurance and family takaful products through the distribution network of AmBank and AmBank Islamic.
“This opportunity, which is pending regulatory approvals, will allow our Malaysian subsidiaries to provide insurance solutions to the banks’ customers, as well as expand our distribution network to serve a wider pool of customers in Malaysia,” said Khor.
Shares of Great Eastern closed Friday down 0.3 per cent or S$0.05 to S$18.24.
