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Prudential to buy back $2.7 billion worth of insurer’s shares

The buyback will be completed by mid-2026.

Prudential Plaza in Newark, New Jersey, US. (Photographer: Angus Mordant/Bloomberg)
Prudential Plaza in Newark, New Jersey, US. (Photographer: Angus Mordant/Bloomberg) (Bloomberg)

By: Adam Haigh and Bernadette Toh

(Bloomberg) — Prudential Plc launched a US$2 billion (S$2.7 billion) share buyback program, as the insurer outlined progress that includes the potential for further shareholder returns.

The buyback will be completed by mid-2026, with the pace and timing subject to market conditions, the company said in a statement Sunday. Shares repurchased under the plan are expected to be canceled.

Prudential has been reaping the benefits from mainland Chinese travellers returning to Hong Kong after years of Covid-era movement restrictions. The insurer posted a 9 per cent jump in new business profit in the first quarter, helped by sales of more lucrative products by its Hong Kong unit.

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Shares of Prudential rose as much as 4.2 per cent in Hong Kong trading on Monday morning. The stock is also listed in London, where it has dropped 20 per cent this year.

“Progress towards our financial objectives will increase the potential for further cash returns to shareholders,” Chief Executive Officer Anil Wadhwani said in the statement.

The company said last year that it plans to more than double its new business profit — a gauge of the profitability of new insurance policies — by 2027.

Prudential joins AIA Group Ltd. in repurchasing shares. AIA in April added US$2 billion to its buyback plan and posted a 27 per cent increase in new business value, led by its Hong Kong and mainland China units.

Goldman Sachs Group Inc. will conduct the first US$700 million part of Prudential’s buyback, which enables the purchase of ordinary shares from June 24 to no later than Dec 27, according to a separate statement.

More stories like this are available on bloomberg.com

©2024 Bloomberg L.P.