Belgian-Dutch financial group Fortis, hit hard by the global financial crisis, will return to an expansion mode in Asia, particularly Hong Kong and the mainland, according to chairman Jozef De Mey (pictured).
Fortis, once Belgium's largest financial group, was bailed out by three European governments after becoming a casualty of the global credit crunch in late 2008. It underwent a restructuring last year that included the sale of its banking arms and asset management business to BNP Paribas of France, leaving only its insurance business.
Although the group was now much smaller, De Mey remained optimistic about its future. 'We will now keep a simple and clear focus on life insurance, non-life insurance and pension business in Europe and Asia. We will do what we know best,' he said during a visit to Hong Kong last week. 'The financial crisis will not affect our expansion plans in Asia, which is the future of growth for us.'
The company's insurance business will have a new beginning and will from May have a new name - ageas - if shareholders approve the change at a meeting in April. 'The new name will show our focus of business will be in Europe and Asia. 'AG' is the company name, 'e' stands for Europe and 'as' for Asia,' he said.
De Mey said a painful lesson learned from the financial crisis was that the former Fortis has been operating too many business lines in banking, asset management and insurance. The complex structure had become unmanageable. In addition, before the outbreak of the crisis, shareholders were demanding rapid growth, which added pressure on management to take on higher risks to chase higher profits. Now shareholders were more realistic and would accept a management focus on risk management and a more gradual growth rate, he said.
Fortis chief executive Bart De Smet said the company's insurance premium income last year rose 9 per cent to Euro16 billion (HK$166.11 billion). The Asia insurance business recorded the highest growth at 25 per cent with total insurance premium income at Euro4 billion.
