East West gets BSP ok on insurance foray

GOTIANUN-led East West Banking Corp. (EW) has obtained approval from the Bangko Sentral ng Pilipinas to jump-start an insurance joint venture with Ageas Insurance International NV, one of Europe’s largest insurers.

In a disclosure to the Philippine Stock Exchange on Wednesday, EW said the BSP had given the go-signal for the bank to put in P500 million initial equity into the joint venture with Ageas.

EW and Ageas have entered into a 50-50 percent partnership to establish a new life insurance company to be called “EastWest Ageas Life”.

Part of the deal is a 20-year exclusive distribution agreement. The aspiration is to build a “premier bancassurance business in the Philippines offering tailor-made insurance solutions to the customers of EW Bank supported by high quality service and state-of-art technology.”

Bancassurance, a new growth area for many banks, refers to the cross-selling of insurance products in bank branches.

The start-up insurance business is seen to benefit from EW Bank’s fast growing customer base. With over 400 branches, EW has the 7th largest distribution network among banks in the Philippines.

Belgium-based Ageas is in turn seen to contribute its bancassurance skills and best practices from its successful businesses in Asia and Europe. Ageas operates successful partnerships in Belgium, the UK, Luxembourg, Italy, Portugal, Turkey, China, Malaysia, India and Thailand and it also has subsidiaries in France, Hong Kong and the UK.