Axa NZ boosts earnings on KiwiSaver uptake

Axa NZ boosts earnings on KiwiSaver uptake, tighter insurance claims

By Paul McBeth

Feb. 15 (BusinessDesk) – Axa New Zealand, the local unit of Axa Asia Pacific Holdings, boosted earnings 24% as it lifted its managed KiwiSaver funds and improved its insurance claims and expenses.

The unit operating earnings of $43.5 million in the 12 months ended Dec. 31, compare to $35.1 million a year earlier, contributing 6% to the group’s operating earnings of A$572.2 million. Group net profit fell 11% to A$601.6 million.

Axa NZ, which is set to come under AMP Ltd. control in a A$13.3 billion merger, said the stronger earnings came from more KiwiSaver funds under management and better margins on its wholesale funds. Its insurance business improved claims and expense experience. The local wealth management business boosted earnings 14% to $10.8 million and the insurance arm lifted earnings 28% to $32.7 million.

Inforce premiums rose 3% to $18.9 million as at Dec. 31, leaving Axa NZ as the country’s third-biggest insurer, while its 7.6% of the KiwiSaver market makes it the fourth biggest of the default providers. The wealth manager funds under management fell 10% to $5.8 billion as at Dec. 31.

The firm’s adviser network fell 15% to 359 advisers at Dec. 31, after it removed unproductive agents. Still, the number of brokers selling Axa products rose to 1,165 as at Dec. 31, compared to 940 a year earlier. The financial advice industry is undergoing regulation to bring it into line with Australia, by bringing greater protections to retail investors after the collapse of the finance sector wiped out some $3.1 billion worth of deposits.

Last month, Axa AP’s minority shareholders have been encouraged to accept AMP’s A$6.43 a share cash and scrip offer after two years of French parent Axa SH’s attempt to divest the Australasian business. Shareholders are set to vote in the deal next month, which will see AMP buy the group then sell back the Asian unit to the French parent.

Axa AP’s shares fell 0.2% to A$6.42 in trading on the ASX today.

(BusinessDesk)

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