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Singapore's UOB Is Said to Review Insurance Deal With Prudential

The United Overseas Bank Plaza building is pictured in 2015. (File photo: Reuters/Edgar Su)

By Manuel Baigorri and Joyce Kohby Manuel Baigorri and Joyce Koh

Singapore lender United Overseas Bank Ltd. is reviewing its insurance business, including an existing partnership with Prudential Plc, after Southeast Asia witnessed a wave of lucrative distribution deals, people familiar with the matter said.

UOB has been soliciting ideas from potential advisers regarding its life insurance tie-up with Prudential, including ways to get more value out of the operations, said the people, who asked not to be identified because the information is private. Possibilities include renewing its agreement with the London-based insurer, which started in 2010, or looking for another partner, the people said.

The Singapore bank is also weighing options for its non-life business, which is run by publicly-listed United Overseas Insurance Ltd., according to the people. UOB’s deliberations are at an early stage, and no adviser has been appointed yet, the people said.

Bancassurance deals in Asia have been fetching top dollar as insurers seek access to banking networks reaching the region’s growing middle class. Standard Chartered Plc expects at least $1 billion over the 15-year life of its Asia agreement with insurer Allianz SE, people familiar with the matter said last year.

Bank for Foreign Trade of Vietnam JSC in June was seeking a new distribution deal that could be worth as much as $1 billion, Bloomberg News reported at the time.

Representatives for UOB and Prudential declined to comment.

UOB sold its life insurance unit to Prudential for S$428 million ($310 million) in 2010. At the time, Prudential also entered a 12-year agreement with UOB to sell its life, accident and health insurance products through the bank’s branches in Singapore, Indonesia and Thailand.

In August, UOB reported second-quarter profit that beat analysts’ estimates, surging to a record as income from lending and fee businesses jumped. Net income climbed 28 percent to S$1.08 billion for the three months through June.

© 2018 Bloomberg L.P