Outgoing Prudential boss Tidjane Thiam yesterday said the company was no longer seeking to grow in the US and UK, and would instead focus on expanding in the Asian market.
Thiam delivered his last set of results as the head of the insurance group, which detailed the firm’s 22nd consecutive quarter of growth.
Sales across the group in the first quarter were up by seven per cent to £1.25bn, compared with £1.17bn in the same period of last year. Asia contributed more than half of the total sales, at £681m, a 34 per cent increase, while the US saw sales fall by seven per cent to £400m.
While post-tax new business profit fell across the group, from £526m to £496m, it grew at the Asian arm, up 27 per cent from £243m to £309m. In the UK retail division new business profit fell by 11 per cent, while in the US it fell by 22 per cent.
Thiam, who leaves the Pru at the end of this month to take up the top job at Credit Suisse, said: “The potential for growth in Asia remains vast.”
Of a 4.5bn population on the continent, Prudential deals with around 14m customers, and Thiam said the company was primed to take advantage of the increasing numbers of people moving into the middle class in Asia.
By contrast, he added: “In the more mature markets like the US and the UK we have no explicit growth targets.”
In the UK, Thiam noted that the group had experienced a slowdown in the annuities business as many customers chose to defer decisions, although he said it was “still too early to discern any trends” in that area.
The Cote d’Ivoire-born exec also declined to comment on the potential impact of today’s General Election.
“We have been around a long time and managed through many elections,” he said. “We are a long term business and we are not overly focused on the short term political cycle.”
Shares in the company dropped 16p to 1596.5p yesterday.
THE MAN FROM THE PRU: THIAM’S JOURNEY TO THE TOP
Tidjane Thiam joined Prudential as finance chief in 2008, and was appointed group chief executive in 2009. His previous experience includes other financial services work as well as a brush with politics. Born in Cote d’Ivoire, he grew up in France, and holds citizenship of both countries. The first job he took after graduating with an MBA from INSEAD was with McKinsey, where he was focused on insurance companies and banks. Thiam’s time in the US also included a stint at the World Bank. He moved from the States back to his country of birth, to take up a job offer from then Ivorian President Henri Konan Bedie. There followed several years working for the government, eventually becoming minister of planning and development, however this portion of his career came to an abrupt end in 1999 when the Ivorian government was overthrown. After spending time under house arrest and subsequently refusing to work for the new military government, Thiam returned to Paris to work for McKinsey. His next move was to the UK, where he joined Aviva, then known as Norwich Union. He spent six years with the insurer before moving to the Pru. Under Thiam’s leadership, the company’s share price has almost tripled, but his time at the firm has not been an unsullied success story. In 2010 his position was threatened by a failed takeover bid for Asian insurer AIA, which led to a shareholder revolt as investors questioned the £23.5bn price tag on the deal. The AIA episode also created regulatory difficulties, and he was censured by the Financial Services Authority in 2013, with Prudential forced to pay a £30m fine for failing to inform the watchdog early enough about its plans. This incident proved to be a blip however, and when Thiam announced his departure from Prudential in March, the news was greeted with dismay by fellow insurance chiefs and analysts. His performance as the new head of Swiss bank Credit Suisse will be one to watch closely.