SCB Agrees to Sell Life Insurance Business to FWD Group and Enter into Long-Term Bancassurance Partnership in Thailand
Agreement will lead to largest-ever life insurance transaction in Southeast Asia
Bangkok, 1 July 2019 - The Siam Commercial Bank Public Company Limited (“SCB”) has informed the Stock Exchange of Thailand that, on July 1, 2019, it has signed a binding Share Sale Agreement with FWD Group Financial Services Pte. Ltd. (“FWD”), the leading pan-Asian life insurer, regarding the sale of its entire stake in SCB Life Assurance Public Company Limited (“SCB Life”), and concurrently entering into a Distribution Agreement to establish a long-term life bancassurance partnership with FWD. At completion, the transaction will be the largest ever life insurance transaction in Southeast Asia in terms of total value.
Under this arrangement, SCB will distribute FWD’s life insurance products to the Bank’s customers in Thailand, leveraging the Bank’s distribution channels for a period of 15 years. SCB will receive a total deal amount of THB92.7bn along with additional payments common in bancassurance transactions over the course of the Bancassurance Partnership.
This partnership combines SCB’s large customer base and best-in-class distribution network with FWD’s innovative product propositions and strong digital capabilities to offer customers superior life insurance products and enhanced digital experiences. The agreement also reflects SCB’s commitment to serve as the ‘Most Admired Bank’ for its customers, employees, shareholders, regulators, and community. The transaction is expected to be completed in the latter part of 2019 subject to certain conditions, such as obtaining regulatory approvals and approval by the Bank’s shareholders.
Following completion, SCB Life’s customers will not be affected by the transfer of ownership to FWD and will continue to receive protections, benefits and customer services in accordance with the terms of their policies. All existing SCB Life policies will continue to be honoured by FWD after the closure of the transaction.
Mr. Arthid Nanthawithaya, SCB Chief Executive Officer and Chairman of the Executive Committee, said, “The bancassurance business remains a key long-term strategic priority for us. The establishment of this partnership with FWD will help create significant long-term value for our customers, shareholders, employees, and other key stakeholders, bringing together the unique strengths of both SCB and FWD. In addition, FWD, as a leading regional insurer with best-in-class customer propositions, strong digital capabilities, and a highly experienced management team, shares our long-term growth aspirations for the life insurance business in Thailand and the value of customer-centricity, which underscore our commitment to clients and this partnership.”
Dr. Arak Sutivong, President of SCB, highlighted the transaction benefits to customers, “Our customers remain at the heart of all we do, and the key objective of this partnership will be to provide a market-leading and innovative product suite fulfilling the evolving savings and protection needs of consumers.” He added, “Both parties share a strong ambition and commitment to developing digital channels. We will continue to devote substantial investment in developing our digital platform, which will significantly enhance our digital capabilities and provide highly enhanced digital experiences to our customers in the future.”
Mr. Huynh Thanh Phong, Group Chief Executive Officer of FWD Group, said, “SCB is a leading bank in Thailand, with an extensive presence and deep local experience. We are fully committed to working with SCB and growing our business in Thailand. We are confident about our product capabilities and we are well aware of the needs and preferences of Thai banking customers. Through this collaboration, we will bring our combined product and digital capabilities to help customers achieve their financial goals and aspirations.”
Phong added, “We have a successful track record of expansion in the region, with extensive experience in building highly effective bancassurance partnerships in the past. This partnership will provide SCB’s growing customer base with access to FWD’s market-leading and innovative product suite and demonstrates our commitment to fulfilling the evolving savings and protection needs of consumers. We believe there is a significant opportunity for future gro
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About Siam Commercial Bank
The Siam Commercial Bank PCL established by Royal Charter in 1906 as the first Thai bank is one of Thailand’s leading universal banks. As of March 2019, SCB’s total market capitalization was THB 449 Bn and the Bank was Thailand's largest commercial bank in terms of total assets (THB 3,200 Bn). Its network of branches and service points offers nationwide coverage.
SCB commits to becoming “the Most Admired Bank” by balancing value propositions to all stakeholders - customers, employees, shareholders, regulators and society - and a leader in shaping the future of Thailand’s banking industry. More information is available on the Bank’s website at www.scb.co.th
About FWD Group
FWD Group spans Hong Kong & Macau, Thailand, Indonesia, the Philippines, Singapore, Vietnam, Japan and Malaysia, offering life and medical insurance, general insurance, employee benefits, Shariah and Family Takaful products across a number of its markets.
FWD is focused on creating fresh customer experiences, with easy-to-understand products, supported by digital technology. Through this customer-led approach, FWD aims to become a leading pan-Asian insurer that changes the way people feel about insurance.
Established in Asia in 2013, FWD is the insurance business of investment group, Pacific Century Group.
For more information please visit www.fwd.com