BRITISH insurer Prudential will press ahead with the separation of its Hong Kong business from the UK parent company at the start of 2014 after gaining legal clearance for the move.
Prudential said in a statement yesterday that courts in Hong Kong and London have approved a timetable for so-called domestication of the business that has operated as a branch of the UK parent since 1964.
Prudential said the rejig affects life and general insurance policies of around 800,000 customers of the Hong Kong branch, out of around 9.5m policyholders administered by the UK arm.
The change is part of a broader shift in the company to make its units in Asia and North America more self sufficient.
Speaking after an earnings statement in August, chief executive Tidjane Thiam said Prudential was in the process of setting up a new Asian holding company that would bring all its Asian operations under a single legal entity.
This would in theory make it easier to sell the Asian business in future, although Thiam said the primary aim was to streamline its Asian operations and the company has played down the possibility of disposals.
The Pru pursued similar splits of overseas units from the parent in Singapore, Australia, New Zealand and Canada during the 1990s, the company said yesterday.
Life insurance policies taken out by clients of the Hong Kong branch will be transferred to a new local life insurance company.
The firm said that its customers should not be affected by the separation, which is expected to take effect on 1 January 2014.
City A.M. Reporter