FWD Group sees operating profit growth in 2023

FWD Group has announced its 2023 financial results, reporting $372 million in operating profit after tax, a 27% increase from 2022’s $299 million, and a new business value of $991 million, up 22% compared to the prior year.

Huynh Thanh Phong, Group Chief Executive Officer and Executive Director of FWD Group, said: “With these results, FWD has again proven its ability to drive organic growth and operating profitability across our business, as we execute our customer-led and digitally enabled strategy.

“Our 10th anniversary year was a transformational one for FWD, representing a key inflection point where all four geographic business segments delivered operating profit for the first time.”

He added: “Everything we do at FWD aims to empower our customers to celebrate living, knowing they have the protection they need, at the moments that matter in their lives. As we look ahead, enhancing our presence and deepening FWD’s footprint across the 10 markets we operate in will be a top priority as we continue to build scale in our business.”

FWD Group saw a groupwide increase in solvency ratio in 2023, to 292% up from 288% in 2022. It also reported a $685 million revolving credit facility finalised in February 2024; total undrawn committed credit facilities are now at $1.185 billion.

According to the insurer, the 2023 year results were driven by positive trends in the Hong Kong SAR and Macau SAR reporting segment, with the return of Mainland Chinese visitors during 2023.

In Thailand, continued leadership in bancassurance, coupled with solid contributions from the agency sales channel, delivered strong results, with Japan also making sizeable contributions.

During the year, FWD Group’s Japan business continued to complete its strategic pivot toward the individual insurance segments, and away from the corporate-owned life insurance business, which has largely run off.

The firm also revealed that, despite the market disruption in Vietnam, its Emerging Markets business generated its first-ever full year operating profit after tax, a result that reflects the scale being built in those markets and a region where FWD Group will continue to invest.

FWD Group recently became the majority 70% shareholder in FWD Takaful Berhad in Malaysia and increased its minority investment to 44% in BRI Life in Indonesia.

FWD Life Insurance Co. Ltd. block reinsurance transaction in Japan – executed in November 2023 to reinsure an in-force block of whole life insurance policies – delivered significant capital and risk management benefits to FWD and was economically beneficial.

However, under International Financial Reporting Standards (IFRS), the firm highlighted, timing differences exist between the recognition of any future IFRS profits and a one-time impact to 2023 IFRS net profits, as the financial assets transferred to fund the transaction were deemed realised.

Additionally, contractual service margin; embedded value; and IFRS equity were impacted by strengthened actuarial assumptions to reflect the latest post-COVID experience and market disruption in Vietnam.

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