Aia Group Ltd S/Adr

Good morning and thank you for joining AIA's 2025 Interim Results Presentation. I will take you through our performance in the first half of the year and provide an update on our strategic outlook. Let's begin with the financial highlights. AIA delivered excellent results with double-digit growth across our key financial metrics. Value of new business increased by 14% to a record high of $2.8 billion. Underlying free surplus generation per share grew by 10%, and operating profit after tax per share rose by 12%. We returned $3.7 billion to shareholders in the first half, and today, the Board has declared a 10% increase in the interim dividend per share, highlighting our confidence in future growth. These results demonstrate AIA's ability to deliver compounding new business growth that drives both cash generation and higher earnings for many years to come. Importantly, our results come from a portfolio of high-quality recurring profit streams anchored in protection, health, and long-term savings that are resilient across economic cycles. In Hong Kong, we achieved record VOMB of $1.1 billion, up 24%, with higher momentum in the second quarter. Demand was strong in both the domestic market and from mainland Chinese visitors, with broadly equal contributions, showing how our customer base is diversified and expanding. AIA's premier agency remains the number one in Hong Kong and Macau and continues to be the main driver of growth. VOMB from agency increased by 35% to a record high, supported by both a larger active agent base and substantial productivity gains. New recruits were up by 15%, expanding our capacity to capture future demand. Within partnerships, Bank Assurance VOMB grew by 27% and the IFA and broker channels showed solid quarter-on-quarter growth with VOMB up 33% in the second quarter. Overall, with our distribution leadership and comprehensive product range, AIA Hong Kong remains exceptionally well positioned for continued growth. Moving now to AIA China. VOMB was $743 million in the first half, with growth accelerating to 15% in the second quarter. Our professional primary agency is what sets AIA apart, contributing more than 80% of VOMB and achieving productivity levels three times the peer average. This is a major advantage in attracting and retaining the very best candidates, positioning us firmly as the number one for MDRT in the market. Recruitment increased 18%, alongside strong growth in new leaders as we continue to expand our market-leading agency. The OMB margin remained very strong, at more than 65%, reflecting our differentiated product mix. Traditional protection is our largest product category and sits at the heart of our customer propositions. Our participating products deliver higher expected returns to policyholders while generating earnings with low sensitivity to interest rates. In addition, we are a leading provider of tax-incentivized private pension products. Selective bank partnerships broaden our reach in the affluent and high net worth customer segments, where we sell large average case sizes and see strong profitability. AIA's long-term opportunity in mainland China is unique. We have grown very successfully over many years in our original five regions. Yet, we have still only captured a small proportion of the potential market. With our expansion since 2019, AIA now operates in 14 regions. The nine new regions we have entered grew by 36% in the first half and contributed more than 8% of AIA China's VOMB. Looking ahead, we expect new business from these new regions to accelerate with compound annual VOMB growth of 40% over the next five years. Our proven ability to replicate success across regions combined with the sheer scale of the opportunity gives us great confidence in our future and in the delivery of our ambition. We have also provided further detail on our Mainland China strategy in a separate presentation by Fisher Zhang, our Regional Chief Executive. Turning now to ASEAN, where AIA is the leading life and health insurer. This region represents more than one-third of Group VOMB, making this our second largest growth engine. VOMB grew by 20% to over $1 billion for the first time. We delivered strong performances across both agency and partnership distribution channels, with agency VOMB up by 22% in the first half and partnerships up by 16%. Our agency is the most professional in the region, while our strategic band partnerships remain a key long-term asset, giving us scale, reach and privilege access to acquire quality customer segments. Across ASEAN, AIA is the number one rank for protection. 95% of our VOMB comes from traditional protection and long-term savings products, generating high quality earnings and a VOMB margin of around 70%. With our strong competitive advantages, AIA is exceptionally well placed to meet the growing customer needs in this region. In India, Tata AIA Life delivered another excellent performance with VOMB up by 38%. Our business continues to rank number one for persistency and it is a market leader in retail protection. Agency now contributes more than half of total VOMB with high productivity and a clear focus on quality, making it the most professional in India. Our bank and broker partners complement our agency, extending our customer reach and driving equally strong growth. Tata AIA's protection-focused strategy, leading distribution and proven execution ensure that we are well on our way to capture India's huge potential. Today's excellent results are the outcome of a growth strategy that plays directly to AIA's core strengths. Asia is the most attractive region in the world for life and health insurance and AIA is uniquely positioned to unlock its full potential. The demographics are compelling. By 2030, Asia will have nearly 2.6 billion people of working age and 700 million aged 60 and above. That means a rapidly expanding base of customers with protection, health and retirement needs. At the same time, wealth generation in the region is unmatched. Personal financial assets in Asia, excluding Japan, are projected to grow at 8% a year, far outpacing other major regions of the world. Healthcare demand is rising sharply. Annual healthcare expenditure across Asia, excluding Japan, is already more than $1.4 trillion, and around 45% of that is out of pocket. This creates a clear role for private insurance solutions. What differentiates us is our competitive advantages. Unrivaled distribution. innovative propositions, and a leading customer experience, all powered by world-class technology and digital capabilities. This is why AIA is the insurer of choice and Asia's most powerful brand. And it is why we have absolute confidence in our ability to deliver sustainable growth and long-term value for our shareholders. Let me now take you through how we are extending these competitive advantages. AIA's multi-channel distribution platform is unrivaled in both scale and quality. Agency continues to be the main source of profitable new business, delivering 73% of the group's VOMB through more than 96,000 active advisors. Our agents are highly professional, building lifelong relationships with customers and advising them as their needs evolve. We have the world's leading agency, having been number one MDRT globally for the last 11 years. The success of our model is self-reinforcing, as it attracts more high-caliber agents to join AIA, extending our industry leadership further. Fast-growing partnerships provide complementary growth, reaching hundreds of millions of customers through our network of strategic bank and broker partners. Together, our agency and partnership channels create a powerful model that drives long-term growth and sets AIA apart. Our propositions are designed to meet the needs of Asia's rapidly growing middle-class and affluent populations. Our solutions are about changing behavior, By rewarding positive choices and integrating health into financial solutions, we create an advantage that goes beyond pure product design. This model is deeply embedded in how we engage with customers, and it cannot be easily replicated. In the first half, we sold new policies to more than 2 million customers, with loyalty from existing policyholders remaining very high. 89% of the group's VOMB comes from protection and fee-based insurance products. Protection generates underwriting earnings unaffected by capital market volatility, while long-term savings deliver fee-based insurance income with limited guarantees. This diversified portfolio is further strengthened by our integrated healthcare strategy, which enhances customer value and supports sustainable profitability. Our ambition is to make healthcare and health insurance more accessible, more affordable, and more effective. AIA is already the leading private health insurer in Asia, and continuous innovation is making our health products more personalized. By integrating more closely with healthcare providers, we help customers receive the right care in the right setting. Our strategy is powered by Amplify Health, our AI-driven health technology and analytics company. In the first half, we delivered higher VOMV growth and a 250 basis point improvement in loss ratio, demonstrating tangible progress. These improvements strengthen customer outcomes, enhance profitability and reinforce the long-term sustainability of our health business. Over the past five years, we have built a strong foundation in cloud, digital platforms and structured data. This means we can now deploy generative AI across the group at speed and scale. This transformation goes well beyond efficiency gains. It unlocks greater value for our customers, distributors and operations. For customers, this means more personalized engagement, faster service and better outcomes. For distributors, it means higher quality leads, smarter product matching and improved productivity. Our operations benefit from intelligent automation at scale, freeing our people to focus on the relationship-driven work that matters the most. As we expand our uses of AI, these innovations will reinforce AIA's position as a trusted, forward-looking leader in life and health insurance. In summary, We are executing a growth strategy that plays directly to our core strengths and sharpens our competitive advantages. We are driving strong momentum across key financial metrics, demonstrating our ability to execute with discipline. I am confident that our ability to deliver compounding new business growth will sustain higher earnings and cash flow generation well into the future. Our growth ambitions are bolder than ever and with the scale, resilience and unique advantages we have built, I'm certain we are well placed to deliver our commitments as we realise AIA's full potential. Thank you. I will now hand over to Garth who will take you through the financial results in more detail.

Good morning everyone. I'll now take you through our financial results. As Yunsheng highlighted, AI delivered an excellent performance in the first half of 2025, with double-digit growth across our key financial metrics of VOMB for new business, OPAT for earnings, and UFSG for cash generation. VOMB was up 14% to $2.8 billion. This drove a 290 basis points increase in operating ROEV to 17.8%. and growth in EV equity to $73.7 billion. The layering of new business onto our Inforce portfolio saw UFSG, our key operating measure of cash generation, increase by 10% per share to $3.6 billion. OPAT also grew to $3.6 billion, up 12% per share, and operating ROE jumped to a record 16.2%. During the first six months, we returned $3.7 billion to shareholders through dividend and share buybacks, which reduced the shareholder capital ratio, in line with our expectations, to 219%. Based on this excellent financial performance, the Board has declared an increase in the interim dividend per share of 10%. I'll take you through further details in three sections. First, the embedded value results, which show how we generate increased shareholder value. AIA is dedicated to writing profitable new business, which compounds over time to support higher earnings and cash generation for the long term. VOMB growth of 14% came from growth in both volumes and margin, with AMP up 8% and margin up 3.4 percentage points. Our VOMB is geographically diverse, with broad base growth from 13 markets. We also grew both our agency and partnership channels. Our financial discipline, products innovation and regular repricing, backed by our powerful distribution platform, have delivered a strong track record of new business profitability. However, the high quality of our new business cannot be judged by VOMV margin alone. We are focused on products that deliver for both our customers and our shareholders. Our traditional protection products provide valuable and affordable cover for families, and generate underwriting profits that are not driven by capital markets. Participating in unit-linked products target attractive expected long-term returns for customers while delivering fee-based insurance earnings. Plus, 90% of BNB comes from these preferred products with a very low average guarantee, producing sustainable, strong, and predictable cash generation. New business has consistently delivered an IRR above 20%. And as we have reduced capital intensity, we generate more VOMV per dollar of capital we invest in the business. Every dollar we invest is paid back rapidly and generates nearly $4 of distributable earnings in just 10 years. Our ability to write large-scale, high-quality and profitable new business with a very attractive financial profile is a key differentiator for AIA. and a major factor in our confidence in the group's future growth. Compounding layers of profitable new business, prudent assumptions, and proactive, enforced management together drive higher EV operating profit, which increases EV equity and, in turn, cash generation. EV operating profit grew to $5.9 billion, mainly from the higher VOMV and improved operating variances, supported by our management actions on medical business. Since IPO, we have achieved positive operating variances every single year. And in total, these have added $4.6 billion to EV equity, demonstrating the ongoing prudence in our assumptions. As a result of the strong increase in EV operating profit, operating return on EV increased by 290 basis points to 17.8%. EV equity grew by 8% to $77.4 billion before shareholder returns. with EV operating profit the key driver. Non-operating items were small, as negative investment return variances were largely offset by the positive effects of exchange rates. After the $3.7 billion of dividend and share buybacks, EV equity was $73.7 billion, up 5% per share over the first six months of the year. EV equity represents the value to shareholders of our large, enforced portfolio. which we have built from many years of writing high-quality, profitable new business, which compounds over time to support higher earnings and cash generation for the long term. The future earnings from the Inforce are mainly from protection and long-term savings products with recurring and resilient cash flows. The combination of our high-quality product mix and prudent approach to asset liability matching delivers predictable cash flow and low sensitivity to interest rates. While earnings continue for decades into the future, the inflows is highly cash generative, with close to $50 billion emerging within the next 10 years. From this, we can fund both increased returns to shareholders and organic new business investment. which further grows our stock of future earnings. New business investment in the first half of 2025 supported a $3 billion increase in distributable earnings over the next 10 years, demonstrating the virtuous circle between VOMB and higher cash generation. UFSG is our key operating measure of cash generation after tax and is shown before reinvestment in new business and central costs. The key component of UFSG is the expected distributable earnings from in-force business, which increased by 7% in the first half, reflecting growth in the business. Operating variances improved from our proactive in-force management, while the expected return on free surplus reduced due to share buybacks. Overall, UFSG grew to $3.6 billion, up by 10% per share. Now moving to the IFRS results. the IFRS results provide an accounting view of our business. EV and UFSG are more reflective of shareholder value, because they consider regulatory reserves and capital, which drive the earnings that can be distributed to shareholders. Even so, IFRS 17 has some similar concepts to EV, in particular the Contractual Service Margin, or CSM. The CSM represents our accumulated stock of expected future IFRS earnings, with each cohort of new business adding further to this stock. New business CSM grew by 15% and supported strong growth in the CSM balance to $61.4 billion at 30 June 2025. The underlying CSM growth net of releases increased to 10.3%, demonstrating our strong organic growth. As a result of stable release rate and a larger stock, the CSM release increased to $3 billion and was the key driver of OPAP. One simple way to understand how OPAP moves from period to period is to look at the drivers of revenue and expenses. A 9% increase in the CSM release and an improvement in operating variances were the main drivers of higher revenue. Improved claims variances were supported by progress in our integrated healthcare strategy. while our disciplined expense management created significant operating leverage. OPAT in 2025 is net of the first-time effect of the OECD global minimum tax regime, with our resulting effective tax rate in line with previous guidance. Overall, OPAT was up 12% per share and increased to $3.6 billion. Our excellent business fundamentals, consistent execution and financial discipline mean that we are well on track to achieve our 9-11% OPAT per share CAGR target. Strong growth in OPAT and our ongoing capital management actions supported a strong increase in operating ROE, which reached a record level of 16.2%. Comprehensive equity provides a more economic view of IFRS shareholders' equity by adding the CSM on a net of tax basis to include the value of future earnings. New business growth and positive operating variances supported a 9% increase over the first half, and after returning $3.7 billion to shareholders, comprehensive equity was $92.1 billion as of 30 June 2025. Finally, capital management. We follow a robust internal capital management framework. Backed by strong financial discipline, our unwavering focus on profitable growth delivers substantial free surplus generation. This supports a prudent, sustainable and progressive dividend and in addition we look to return capital to shareholders that is surplus to our needs. All while retaining sufficient financial flexibility to capture the huge growth opportunities available to us. AIA's clear capital management policy sets out how we deliver sustainable and growing returns to shareholders over time through dividends and share buybacks. The first part is a payout ratio target of 75% of annual net free surplus generation. The second is a commitment to review our capital position and regularly return capital in excess of our needs. We believe that AI's ability to deliver across growth, earnings and cash sets us apart from our competitors. Following our established dividend policy, the Board has declared a 10% increase in the interim dividend per share. In the first half, net free surplus generation, after reinvestment into new business, was $2.4 billion. We expect a similar seasonal pattern of net FSG in 2025 as in previous years. The total 2025 net FSG will determine the overall shareholder payout for the year from the first part of the capital management policy. The final dividend and the balance of the 75% target payout will be announced at the 2025 annual results. Now moving to our capital position, which is best viewed through free surplus and the shareholder capital ratio. Looking at the development of free surplus since the start of 2022, when we commenced our first share buyback program, you can see three major components. You can also see that variances over time and our inorganic capital investments have both been small. The first component, NetFSG, after investments made into organic new business at highly attractive returns, has generated $14.5 billion of capital. This NetFSG comfortably supported the second component, $8.6 billion of shareholder dividends. Our commitment to return excess capital resulted in the third component, which saw us deploy a further $13.3 billion through share buybacks. In aggregate, we have returned $22 billion to shareholders through our disciplined capital management. As a result, you can see that our shareholder capital ratio has reduced progressively in line with our expectations and stood at 219% at 30 June 2025. In conclusion, the Group has delivered an excellent financial performance in the first half of 2025. with double-digit growth across our key financial metrics of new business, earnings and cash generation. We remain confident in our outlook. AIA is exceptionally well positioned to capture the enormous growth opportunities in Asia, the most attractive region in the world for life and health insurance. We believe that our strong balance sheet, financial flexibility and clear growth strategy set us apart. while our proven track record gives us great confidence in our execution capabilities. We are focused on driving high-quality, profitable new business growth with highly attractive reinvestment economics. This adds further substantial layers of recurring earnings and cash generation well into the future that in turn will generate highly attractive returns for shareholders. Thank you.

from AIA Central in Hong Kong. Welcome to our 2025 Interim Results Analyst Briefing. I'm Lance Burbage, Chief Investor Relations Officer for the AIA Group. Together with me on stage today are Li Yuansong, our Group Chief Executive and President, Garth Jones, our Group Chief Financial Officer, and our four Regional Chief Executives, Jackie, Fisher, Haklei, and Leo. We have other members of our Group Executive Committee with us in the room. Before we start the Q&A, let me just remind you that we've shared on our website a separate video on AIA China's growth strategy. I hope if you haven't had a chance to watch it, you will be able to later. With that, we can begin our Q&A session. If you want to ask a question, please make sure you're logged in to the Zoom webinar. Operator, over to you, please.

Thank you. Ladies and gentlemen, if you wish to ask a question, please click the hand-raising button and wait for your name to be announced. After I call your name, please press the unmute button shown on your screen and ask your questions. If at any time you need to cancel your request, please unclick the hand-raising button. Let's proceed. And our first question comes from M.W. Kim of J.P. Morgan. M.W., please press the unmute button shown on your screen and ask your question.

good morning and thank you for taking my question the first of all the congratulation on the strong result in the first half and we really appreciate a new update on China mid-term growth strategy with a clear guidance so I have a two question one is about the TSR so So that is about the 2026 figure. So the challenge aspect is that when you consider 75% of a net free surplus generation for 2026 TSR, it appears to be somewhat lower than other financial stocks in Hong Kong. However, Over the past few years, as mentioned in the presentation slide, and as a part of a company's capital management policy, one component of TSR is to return a portion of surplus capital to the shareholder on a regular review basis. Could you provide some guidance on 2026 TSR on the basis? And the other one is about India. So the company mentioned that Tata AIA delivered a strong 38% growth in the new business value in the first half of 2025. Additionally, the company highlighted this joint venture as one of the top three private life insurers in India. So, could you please remind us how significant India's new business value is in relation to the total group new business value at this stage? Is it closer to the 5% of group MBB or still below their level? And also, when can you expect a separate disclosure for India business, please? Thank you.

Thank you, Kim. Like you, I'm quite very pleased with the results that we are announcing for the first half of 2025. As Garth shared, we grew our UMD by 14%, and that's off the back of very strong growth in 2024 and 2023. So I'm quite pleased with that. At the same time, in terms of our some of our operating metrics like ROEV of 17.8% and ROE of 16.2%. These are at record highs. And we have also achieved a 10% per share growth in UFSG and our board has recommended a 10% per share growth in interim dividend. Now as for your question about TSR, I'll hand over to Garth to talk about it, and I'll invite Leo to talk about India. Thank you.

Yeah, thanks, MW. I think there are sort of two points to make, really. The first is, if you look at the direct returns to shareholders, we've seen increasing dividends. We saw another 10% increase. And you saw the buybacks that we've done, $3.7 billion in total return to shareholders in the first half. And in July, we had the stub of the buyback, the $1.6 billion buyback. So that was another $350 million. So there's that direct returns, but I think beyond that you should look at the ROE, which is increased to 16.2%, a substantial increase in the ROE through our capital management, and in the ROEV to 17.8%, because ours is based not only on the dividend and so on, But it's also, you have to think about the growth in the balance sheet over time and you've seen very strong growth in the balance sheet in the first half and despite that you've also seen the improved capital metrics as well. So I think ROE and ROEV should really be where you're focusing your attention if you think about the future rather than looking at the TSR in the way you did.

And good morning, M.W., and thanks for your question on India. As you highlighted, we're very pleased with the excellent performance of Tata AIAs this past period. In terms of separate disclosure on India, we're not yet ready to proceed with that at this point in time or indicate a timing for it. But I'd just like to highlight and just reinforce the performance that we're seeing with Tata AIA. We've been delivering very strong performance, but performance with quality. If you look at VNB growth, it's been excellent, driven by both AMP growth in agency as well as Benka and the broker segment, and improving margins. Our growth in agency is on the back of very strong fundamentals, double-digit growth in our number of active agents, our number of leaders. And our broker and Bank Care Growth is also very broad-based, in particular with a couple of new partners we've added over the past year. And then improving margins with strong fundamentals operating margins are improving with strong improvements in cost efficiency, as well as a big focus on product mix, which is also fueling those margins. And then we're seeing this being delivered with very strong quality. Tata AIA continues to be the number one insurer in India in terms of persistency. We also continue to be the number one in total summer shirt in India, which reflects our leadership and our focus on protection. And then finally, also number one in terms of MDRT this past year, reflecting our focus on premier agency. Thank you.

Thanks, Leo. And just in terms of its scale, and obviously this is at the 49%, it's about one third of other markets in the first half of the year. Does that answer the questions, MW? Yes, thank you so much. Thank you. Next question, please.

The next question comes from Charles Zhou of UBS Securities. Charles, please press the unmute button shown on your screen and ask your questions.

Okay, thanks. So first of all, congratulations on a very solid set of results. So I have three questions. The first one, we see a very ambitious growth for AI China, 40% CAGR from 2025 to 2030 in the new regions. So can you maybe share a little bit more colors about this target? The second question, we also see the annualized operating ROE is 18% and operating ROE is 16%. So both I think is a record high. So what are the key drivers behind and are these levels sustainable going forward? And the third question, perhaps it's a bit difficult, but I have to ask, if at all possible, I would like to touch on the topic of Mark Tucker's new role as the chairman, who will join AIA on October 1st. And this is also a key area of interest for the investors, so I'm keen to see if there's any initial thoughts on what this means for AIA's future direction, mainly on three aspects. First is about the business growth strategy in terms of geographical focus, inorganic growth, and also distribution focus. Second is the capital management policy. And third is the senior management setup. Thank you.

Thank you, Charles, for your three questions. First, on the question of the VOMB growth ambition for the new provinces or new geographies in China, As you know, this has always been a question that many investors have asked us. So what are all these new provinces, what are they going to do for AIAs in terms of, you know, that can be material? I'd just like to share with you, first of all, that this ambition has been set bottom up. came from the business unit and based on my experience in China looking at this 40 percent CAGR over the next five years I think it's a very good ambition first I think it's quite stretching 40 percent CAGR secondly you know at the same time I you know it It demonstrates that the business unit is thinking about, you know, building this, achieving this growth on strong foundations, delivering it in a, you know, sustainable and based on high quality. So it's a good balance between stretch and, you know, quality and strong foundations. And I really actually, you know, commend the business unit for setting this ambition for the new geographies. I'll invite Fischer to talk about it a bit more.

Thanks, Renqiang. Thanks, Charissa, for the question. I think we are very confident to replicate our success across the new views. A couple of factors. The first one is that The potential, I think the new builds has a great business potential. If you look at those factors like urbanization, rising affluence, demographic change, And also, you know, the huge base of our target customers. I think, you know, it's a great potential for us. I wouldn't go through the details in this category. But I think that the second one is very important, is the key success factors, those key drivers. I think we are very solid in the key drivers. And we believe there are three key things. And the first one is a proven business model. which are our premium agency model and also the differential bank transfer model. You know we are very disciplined in executing and you know there is a new BU acceleration program on the way. The Dagmar is a scalable operating model. Our two shared service office works very well. You know almost fully digitalized if you look at our STP ratio. And we are accelerating the generative AI to further improve the efficiency and effectiveness. The last one is about the strong talent preparation. We are recently refining our target operating model. I introduced a new chief expansion officer. It's a dedicated team looking at this. And also we have about 100 strong talents in our program for future GM and also the DOA. So lastly, I think it's about the strong track record. You know, this time we show some details to you. Actually, for the first half, our new views has increased by 36%. And for the past three years, the trigger is more than 40%. So quite good progress. And for the new four, which are Zhejiang, Anhui, Shandong, and Chongqing, we launched the business in May. We already accumulated more than 1,700 strong talents. And the new agents are joining us. So combining all this potential, our solid key drivers, and also our strong track record. So we think, you know, as Yuanxiang said, we set this aspirational target. We think it's aspirational and also achievable.

Thank you, Charles. And on your question on the record high operating ROE EV and operating ROE, I'm very pleased with what we achieved. You asked about the drivers. Clearly, the primary driver for this is to ride. high quality profitable new business. I think Garth explained at length about what he means by high quality profitable new business that generates the layers of future earnings and cash. I think the second very important driver clearly is the the management of our highly profitable enforced book that has been accumulated over many many years and you've seen you know that our enforced book is you know largely in you know what we call you know traditional protection or or products that have uh you know uh based on fee-based income that's resilient to capital market movements and and thirdly i think it's really about a disciplined capital management i will I hand over to Gav to elaborate.

I think you've got it well there, Yinxiong. You've seen in the first half that great progress has been made on all of those and then the results come through in the ROE improvement and the ROEV improvement with the profitable new business growth being very strong, the operating variances also improving and then the capital actions that we've taken during the first half. all adding up to a very strong and a very attractive position for ROE and ROEV.

Charles, on your third question about Mark Tucker, I must say that our current chairman, Dr Edmund Zee and the rest of the board of directors and myself, we are very pleased that we are able to get Sir Mark Tucker to join us as the incoming chairman. He'll be coming in October. Mark will be based in Hong Kong, but knowing Mark, he'll be travelling extensively across the region and globally to promote AIA with all the major stakeholders. In identifying Mark as the incoming chairman, The board ran a very, very thorough process that started in the middle of last year. we appointed an external consultant to help with the search and the board set up a working committee that comprised you know the chairs of all the previous chairs of our board committees and I was also in the working committee and when we identified Mark as the preferred our top target Edmund and I, we both approached Mark and through many conversations, we were able to come to agreement with him that he will join us this year in October. Your questions about his priorities, I would suggest maybe we leave when Mark has arrived in October. But in my conversations with Mark, I think he has made very clear to me that he'll be focused, seeing his... on three areas. One, which is governance. Secondly, it's on strategy. And thirdly, it's on leadership development. But the details, maybe you'll wait until Mark arrives. Thank you.

Thanks, Xinzong. Does that get the answers to your questions, Charles?

Yes, thank you.

Question, please.

The next question comes from Thomas Wang of Goldman Sachs. Thomas, please press the unmute button shown on your screen and ask your question.

Thank you. Morning, everyone. Congrats on the good set of numbers. A couple of questions. Firstly, I think China's margin was a positive surprise. We're now almost back to 60% margin. And that's despite all the economic assumption changes. Can you just help to give a little bit more color what drove that margin change on a young year basis? And then when we think about this, another round of repricing action coming in the third quarter. So how do we see margin heading for next year? And then the second question, Hong Kong, obviously there's some sort of promotion ahead of 1st of July. How much of growth in the second quarter do you see kind of as a sustainable level or just what is sort of views on MCV and then post-MCV and domestic sales in Hong Kong? Thank you.

Thank you, Thomas, for your question. On the China market, I think really it's about our differentiated strategy and model in China. We have the market-leading Premier Agency channel. We have a very differentiated bank assurance model. And in terms of the products that we sell, I think China, We have also shown that we have a very differentiated product mix that comprise 43% traditional protection, 41% participating which has very low interest guarantees. and the text inside device. We are also a leading writer of text inside device products. In terms of the new business economics itself, I think Garth explained that although we focus on, I think the market focuses a lot on value of new business margin, we also look at other metrics that reflect the quality of the new business and that includes the

IRR, the capital efficiency of the new business, how the future generation of cash and how fast the cash return is generated. And these are indicators that we look at in terms of managing the quality of our new business, specifically on the China VOMV margin.

I'll hand over to Fisher to talk about it.

Thanks, Yuanxiang. Thanks, Thomas. I think the margin change are mainly driven by several key factors. like, you know, economic assumption change, especially the investment return assumption. And also, you know, we proactively shift to par. As you can see from the presentation, we actually, in the first half, has successfully shifted basically all the long-term saving product to participating product. So these two factors actually drag down the margin. But these two actually have been offset by another factor of a proactive rate price of product by lowering the cost of the guarantee. So basically the margin is, these are three factors kind of flat. So another factor is we proactively shift more product to the longer premium payment policies. So last year we sued some three-year pay policies, but this year we reduced a portion and shifted more to the longer pay. So these actually help the customer because it's more affordable for them and also the customer is more sticky to other company. So these actually increase the margin a little bit. So together with all these factors, the margin we have observed a bit improved. So talking about the future, you know, we have consistently said, you know, we manage the business by focusing on the absolute amount of amnibian bond rather than look at the margin or the volume only. But what I can say is, you know, as Renshan said, our product is quite well balanced and our aging is very capable. So we will definitely ensure our decent margin and, you know, manage the business very well. Thank you.

Hong Kong is our largest segment and we've seen a very strong demand for our products in Hong Kong, both from the mainland Chinese visitors and also from Hong Kong domestic customers. As you can see, in terms of MCVs, it grew by 30% in the first half and domestic grew a strong 18% in the first half of 2025 as well. I hand over to Jackie to talk about Hong Kong.

Thank you, Yunsheng. We are very pleased with the AI Hong Kong and Macau Red Court first half result. Delivered VNB growth of 24% and it's broad-based growth. Both MCV customer segment and domestic customer segment has double-digit growth. And you can also see that all this growth are driven by a very strong underlying driver, especially the number one agency in the Hong Kong market. We are number one MDLT Hong Kong MacPow and also number one MDLT globally for the membership year 2025. The agency force continue to grow from strength to strength through increase in active agent, 15% increase in new recruit. This underlying driver actually continue to propel our business strongly. And in fact, you can see that Hong Kong MacPow deliver double digit growth in first quarter and another very strong double digit growth in second quarter. Of course, we do benefit from the higher demand for a participating product, especially for the month of June. But you know, in Hong Kong, AIA Hong Kong, we don't compete on registration. We compete on the innovative product proposition. So, effective July 1st. At Hong Kong Macau, we launched a new innovative long-term saving product, and this product is very well received in the market through all our channels. And with the strong undying drivers of our premier agency and selected quality partners, at Hong Kong Macau are well positioned to capture the growing opportunity going forward.

Thanks Jackie, and thanks for the questions Thomas, does that answer them? I'll take that as a yes. Next question please.

The next question comes from Richard Hsu of Morgan Stanley. Richard, please press the unmute button shown on your screen and ask your question.

Thank you for the opportunity for the questions. Also congratulations for the very solid results. I got three questions. One is on the Hong Kong I mean, obviously, there's some change in the competitive landscape, right, because of these, I guess, broker channels, aggressive sales in second quarter. Do we see any impact in our second half demand, any front loading? And also, will that, you know, change our pace of sales for the second half of this year? On China, 40% CAGR is obviously very impressive, the expectations. I'm wondering whether there's any inflection point. I mean, obviously, there's been a lot of preparations. The sales has been very strong. Any periods of potential acceleration over the next several years? Essentially, whether the 40% CAGR will be smoothly, you know, paced over the next five years, or is there going to be some acceleration or slowdown? And lastly, on the, I guess, free surplus at the moment, you know, it's come down to, it seems like, you know, somewhat comfortable levels. Do we expect more of a dividend as a main channel for, I guess, shareholder returns? Or, you know, will buyback still be considered next year? Thank you.

Okay, thank you, Richard, for your question on Hong Kong. I hand over again to Jackie to talk about this topic that seems to be attracting a lot of interest.

Yeah, very pleased to see that, you know, in Hong Kong, Macau, actually the PMEA agency contribute more than 70% of ourselves. And you have very strong fundamental to continue to grow. And our partnership distribution also give us a double digit growth in the first half of the year, driven by a very strong result from our BA and also a quarter to quarter increase from Citibank. Our broker channel in Hong Kong, we have a quarter to quarter performance growth and also deliver for the whole first half growth. This was, of course, also driven by the stronger demand for power product in the month of June in the broker channel. And as I said, we launched a new innovative long-term saving plan, effective July 1st, and that plan was very well received in the market by all our channels, which include the IFM broker channel, and we continue to see the strong momentum already built in our IFM broker channel. And we continue to be very careful in managing our financial performance and make sure that we deliver quality new business through all our channel.

Thank you, Richard, on your question on the VOMB ambition for the new geography, the new branches. As I said before, I think this is a good ambition. Balances stretch and the focus on quality. I also like to remind you also that over the period of the first half of 2022 to 2025, the new geographies actually grew by 46%. But I wouldn't say that that implies that you will grow at that kind of pace. But I just remind you of that. And I also invite you to take a look at uh the video that we've uploaded uh where fisher or it could be fisher it could be his ai who's presenting on our aia china strategy and hopefully that will give you clarity on how we intend to deliver

the strong growth ambitions for the new geographies as well as to deliver strong sustainable growth in our existing original five branches which will and I also like to remind you that we still at the end of 2030 despite the strong growth in

the new geographies, the original five will still be contributing to the bulk of the VOMB from AIA China.

And then, a question to Doug?

In terms of returns to shareholders, besides any change in the share price, clearly then we have the dividends and buybacks. We've set out in our capital management policy clearly the target of 75% of net free surplus generation to be paid through a combination of dividends and buybacks. We've also said our dividend policy for many years has been prudent, sustainable and progressive. And you can see from the very first dividend it's been prudent, sustainable and progressive. And on top of that, we'll look at the business and the balance sheet and look at if there is any capital in excess of our needs. We'll also return that to shareholders. If you look back from 2022 onwards, we've returned a total of $22 billion. of which 8.6 billion has been through dividends and 13.3 billion has been through share buybacks. So we have flexibility and tools to manage the capital effectively and to provide the best returns possible for shareholders. But clearly the best way we can deploy capital in is in organic growth. That's where we get the highest returns. And you can see how we've done that in the first half very well.

Thanks, Garth. Does that answer your questions, Richard?

Yes.

Thank you very much. Thank you. Next question, please.

The next question comes from Michelle Ma from Citibank. Michelle, please press the unmute button shown on your screen and ask your question.

Thank you, management, for giving me this opportunity. This is Michelle Ma from Fidi Research. I have three questions. First, as Yanshan just mentioned, for China business, the bulk part is still with the original five regions. So given we have a very high growth target, 40% for the coming five years, so how do we think about the original five regions which still accounted for like 92% of mainland China's BOMB. That's the first question. Second question is, did you share for the new regions which obtained license last year we already we already seen 1700 agents in that four areas so that's really impressive and just wondering have we adopted a different recruitment approach? Have we been trying something new in these four areas? Because just within one year, on average, each region has already recruited more than 400 agents that's really impressive and if that's the case will we expand or extend this experience to other regions like the five developing regions in China the last one is with Malaysia So because of the regulation updates on the product repricing in December last year, actually that took a lot of time of our agents to explain what happens to our customers. So that, you know, dragged down the first half agency channels rose. Just wondering from management perspective, how long this negative impact will last and um yeah two two two because we we've seen very uh strong growth in the partnership channel so just a rough estimate of the timing of impact on the agency channel thank you yeah thank you michelle i will hand the two questions on china to fisher and again i repeat encourage you to watch the video

Okay. Thanks, Yuanxiang. Thanks for the question. I think let me tell a little bit about the first half performance. So actually, as you see, especially the second quarter is gaining momentum. The reported benefits are back to the positive growth, and like or for like is 15% growth. Actually, if you look at not just the past shift, if you look at the agency foundation, we are very good. Number of recruits increased by 18%. Number of active new agents increased by 11%. And the most important thing, which is the future manpower growth engine is a new leader, increased by 71%. So I want to point out that all of this actually are majorly from the existing five views, because existing five views is still more than 90% of the share. So we are seeing a very good momentum and very good foundation. So this time, you know, we especially talk a little bit more about the new view because it's quite new. But we think, you know, our existing views, they have strong track record. And we do expect they can still deliver very solid, strong growth in the future. As Yuanxiang said, I will highly recommend you can watch my video, my presentation that is delivered by my digital avatar. I may have a future opportunity to introduce more about that generative AI. But that shows, I firmly believe the potential of mainland China market is still huge. And we have a unique growth opportunity. We are in a unique position to capture that opportunity in China by our premium agency, differentiated bank insurance model, and unique geography expansion. So, I think that's my answer. We still, in short, still believe and are confident our existing view can deliver strong growth in the future. As for the second question, for the new views, thanks for your encouragement. I also think 1,700 is a very good achievement. I want to confirm we are very disciplined. We never sacrifice our quality. We follow the original standard. And frankly speaking, especially for this new city, we are more stringent. You know, the selection is very stringent. Standard is very high. And, you know, in this, 1,700 is almost all a bachelor degree. So I think it's very good. I also want to point out is we are not doing from the scratch. You know, we already have so many, you know, agents in different areas. Some of them, you know, because I'm from Anhui, I know quite a lot of Anhui needs actually that worked in Beijing, working in Shanghai. So we do have some aging agency leaders. They worked in, you know, developed the cities. So this time when we opened the new, you know, license, actually they are very willing to refer their family, their friends to us. So that kind of the program actually helped us a lot. But definitely we replicate, you know, that kind of practice into future. But I also want to point out, you know, the good recruitment achievement is also because our strong branding, our strong branding, you know, strong differential capability in the premium agency. I think that's a key.

Okay, your third question on Malaysia. First, I'd like to say that we have a very high quality business in Malaysia. I think our agency is also the number one agency in Malaysia for the last nine years. We have an excellent partnership with public bank. Our agency channel, the underlying momentum of the agency channel I think is healthy. The first half is really a temporary disruption. But if you look at the underlying performance of the agency channel. It is healthy and I'd like to hand over to Hartley to talk about Malaysia.

Thank you, Michel, for the question. As you already pointed out, AI in Malaysia's V1B was lower in the first half of 2025 and it was very much because of the slowdown in the sales of individual health business as a result of Malaysia's industry-wide review on health insurance. And during that period, our agents devoted substantial amount of their time serving customers to helping them understand various options available to them under the reform. This is clearly the right thing to do. We are very proud of what they're doing, although it's taken a fair bit of their time from focusing on sales activities during that period. And we are very pleased to see that the medical claims experience in first half have actually improved quite substantially because of heightened awareness, heightened public awareness of the underlying issues, as well as the effective implementations of the numerous cost-containment measures. And then all this has contributed to strong OPEC growth of our Malaysia business in first half. In terms of new business, we are beginning to see new medical sales achieve positive month-on-month growth in the second quarter of this year. And we're also encouraged by the very strong recruitment momentum of our market leading agency force, nine times number one MDRT. Recruitment recovered strongly in second quarter this year. And in fact, our Takaful agency is now back on positive year-on-year growth at the end of first half so overall as the engine highlighted our new business portfolio in malaysia remains of high quality and profitable a very strong focus on protection of course other than agencies slow down especially in the first quarter we see the partnership distribution continue to grow very strongly supported by our ability to serve the affluent and high net worth customer segments of public banks. Overall, we are pleased, although there's temporary slowdown, we are pleased and confident with the strong underlying fundamentals of our business in Malaysia.

Thank you. Thanks, Hakele. I think that's pretty comprehensive answers, Michelle. So, next question, please.

Thank you. The next question comes from Michael Chang of CGSI Securities. Michael, please press the unmute button shown on the screen and ask your question.

Thanks. I've got some questions for management. Firstly, in relation to the power mix, I noticed that it was very high in mainland China, and can I just get a sense, is this mix a new normal, or should we actually expect the power mix to actually increase going forward? Secondly, the Thailand margins of 160% in the first half. That's a record high of any region, I think, since the IPO. So what in particular is driving that insofar that there's been a market increase in the mix of medical insurance products? how optimistic are you about further shifts in the product mix towards health and protection going forward? And then lastly, could I get Gav just to elaborate a bit on the BEPS II impact, how it impacted the numbers this period? Can I just confirm that it only impacted the OPAT and not so much CSM, EV and VOMV? Thanks.

Okay, on the PAR mix in China,

Thanks for the question. I think in China, in the first half, we basically shipped all the long-term savings in agency to the park. But I think, you know, the PAR mix will be further improved because, you know, nowadays the CI product are still non-PAR. It's a stipulated by the regulation. But going forward, it may, you know, have some relaxation on that. So very probably we could introduce the PAR CI product in future. That will further increase the PAR mix. Thank you.

I'm Hockley on the Thai margin.

Thank you, Michael. We are very pleased with the excellent B&B growth of our Thailand business infrastructure of 36%. Yes, we benefited from the one-off sales of individual health insurance business in first quarter, ahead of the new regulatory requirements that was introduced towards end of March. But in addition to that, we also saw a very positive shift in product mix throughout first half towards protection, especially critical illness riders, and that's substantially increased the overall portfolio margins of our business in Thailand. Of course, as always mentioned, our focus is always on growing, achieving strong BNB growth rather than focusing solely on volume or margin alone. As you can see, we are a clear market leader in Thailand. We have the strongest agency force. We've been consistently number one in MDRT every year since IPO. Our agency force continues to grow in productivity, in manpower. Our agency force has 44% overall market share and more than 50% of the new protection business in the market. In addition to that, we are encouraged by the strong growth of partnership with the Republic Bank, apologies, with Bangkok Bank, supported by the increase in the case size as well as the activity of the sales force. very strongly positioned with our market leadership across all key segments in Thailand. We are actually in a strong position to support the growth of life and health business in Thailand.

Yeah, the global minimum tax, Michael, it's the first time that we've got the global minimum tax. It came into effect from the 1st of January this year. We have included in the appendix, it is page 69, details of the numbers that have flowed through the various measures, which I think should be helpful to you. Just to give some colour and a high overview, the global minimum tax is something that has come in, as I say, this year. It's the first time. It's already included in our numbers for the first half, so it's already included in the OPEC growth, in the UFSG growth, and in those numbers, in the actual numbers. It's also something that we have in the net profit and the number in the net profit is 51 million. You'll see the details in slide 69, as I say. When we look at the global minimum tax, we see that it's very difficult to estimate what it will be in the future. It depends on a number of different things. It's based broadly on net profit in each jurisdiction. And that net profit may vary from year to year. It also depends on new business volumes and exactly which jurisdiction the profits arise in. For that reason, we don't think it's appropriate to calculate it in the EV. And we don't have it in the CSM either. That's in line with IAS 12. There was actually a specific guidance from the IFRS, the ISB, that under IAS 12, that it wasn't to be accounted for as a deferred tax item. So that gives you some idea of the difficulty of projecting it. What we can say is what we've said before, that it will mean that the effective tax rate goes to between 15% and 18%, and you'll see that the effective tax rate is at 18%, which is in line with the guidance we've given. And the only guidance I can really give you is that it will be, we expect 15% to 18% to be there for the near term, but very difficult to estimate beyond that. But as you can see, Our numbers are still very strong and it's a relatively small amount compared with our overall numbers.

Just one final thing to add on the EV. The EV operating profit and therefore the ROEV is net of the GMT as well. Does that answer all the questions, Michael?

That's good. Thanks a lot.

Thank you. Next question, please.

The next question comes from Michael Lee of Bank of America Global Research. Michael, please press the unmute button shown on your screen and ask your question.

Thank you. Thank you for giving me this chance to ask questions. My questions are for Gus. So it's about the capital management and the buyback. So I know you have two parts of the buyback. One part is from the net free surplus generation every year, and also the major part is from your annual review of your capital status. So I want to make it clear that whether you have certain level of capital ratio you want to maintain, or you have certain level of surplus balance free surplus balance you want to maintain because free surplus balance in first half of this year dropped by quite a lot to below 10 billion and well it impacts your buyback decision and also another question about bad buyback is whether stock price in the market will impact your buyback decision Of course, I hope that stock price of AI could remain strong, but this will impact the effect of your buyback. So do you have some consideration about buyback size and timing when it links to stock prices? And also about buyback period. So this year, your buyback was between April and July. So any consideration about this kind of buyback period? Thank you.

Thanks, Michael. A few questions there. I think in terms of the amounts of buybacks, we've said that we'll look at those at least annually as we get the year-end position and our business plans in place. With that, you'll see that we said also that we want to remain – our current level is comfortably above 200% in the shareholder capital ratio, although we will review that as the business changes over time. When we look at the level, we do look at the stresses and so on that we have in the business and the stress capital that we need. And so we tend to think of it more in terms of the absolute numbers. The ratio is helpful as guidance, but we tend to think of it as absolute numbers overall. and so on. But, you know, at $9.9 billion of free surplus, we are very strong, very comfortable, and the shareholder capital ratio has reduced in line with our expectations, but remains at 219%, which is comfortably above 200%. In terms of the buyback considerations, clearly we look at The way in which we'll use the capital, the obvious is to use buybacks, and we've done that to date. If you look at the value of the stock, I think not just in terms of the IFRS book value, but look at it more generally, thinking about future growth and so on, and we look at the overall levels. of share price in deciding what's the best action for shareholders. But today we bought shares, we thought the shares were good value, and I think that's been the case. In terms of timing, we would tend to declare every year, so that would be at the end of March. and then the actual timing is April to July. It depends also on the size of the buyback. You have a certain proportion of the market that you can have as buybacks each day, and so that also impacts the period. But you would expect that it would normally start in April and then run from there, depending on the market volume and so on. Thank you.

Michael, we've got time for one final question, please.

Sure. The last question comes from Leon Chee of CLSA. Leon, please press the unmute button shown on your screen and ask your question.

Good morning. Thanks for taking my questions. This is Liang Qi from CRSA. My first question is on how we should understand the China growth strategy and our capital management policy. A very ambitious 40% VOMV growth target. Appreciate that. On the other hand, we do understand market focus on the capital management. So if management could share any color on how we should understand the relationship between between such a very ambitious growth target and also capital management policy. I understand it's probably more on the new business investment side, impact on free surplus and shareholder capital resources. Second question is on the product repricing and also China growth. We all know that from the 1st of September, the regulatory pricing interest rate cap on all the different products in mainland China is being cut once again. And the 1st of September is just a few days ahead of us now. Earlier, also, Fisher mentioned our repricing efforts and market demand. Some other analysts also have touched this, but I'm just trying to see if we could be more specific on the repricing of our products and how our client demand looks like on that front. And thirdly, on the interest rate impact on our capital management. I remember that in the second half last year, actually the interest rate declines in particular in mainland China and also Thailand has caused some quite significant negative impact on our free surplus and also shareholder capital, in particular the required capital. Gas has also given a few numbers a few months ago on the second half last year. This time around, in the first six months of this year, actually treasury yield in China has been going sideways. So specifically on these two metrics, Is it safe for us to say that in the first half of this year, interest rate has already became a non-material factor in the movement of our required capital and also free surplus? So if we could try to quantify this interest rate impact. So three questions from me. The China growth versus capital management. Secondly, China product repricing and China growth pricing. And thirdly, the interest rate impact, is it behind us now for capital management? Thank you very much.

Okay, thank you for your question, President Leong. First, I want to clarify that the 40% VOMV compound annual CAGR ambition relates to the new provinces, the new geographies in China, which makes up currently 8% of the VOMB of AIA China. So it's the 40% on the 8%, right? And it's not the 40% catered on the whole of China. Second, I'd like to point out also the fact that as Garth explained, you know, some of the metrics that we looked at in addition to VOMB margin is the capital, the new business investment, the proportion of how much DOMB is written per dollar of new business investment, the IRR of the new business investment. And actually, in China, because of the shift to PAR, the capital efficiency has actually improved. thirdly i think uh if you uh you know you'll see uh from you know that our the sovereignty position of our aia china is very strong so um i think uh i hope i've addressed your first question on the the the growth target versus and capital management and on repricing i think Thanks for the question.

I think for the repricing, the regulatory requirement actually reduces the pricing interest rate of the non-PAR to the 2%, and the participating product to the 1.75%. So I think actually we have repriced, prepared all the repricing. We find the new product already. We plan to launch it in September. So everything is ready now. I'm thinking of talking about the product attractiveness. That's a key for the future. Because the PIR has done so much, whether the product is still attractive, the answer is yes. It's because we shift the model part. I think the part is... That's why we are so keen on the part shift. Because the part... It's kind of a win-win to the company and to the customer. Because in the low interest rate environment, power definitely can reduce interest rate sensitivity. But to the customer, it can have the future upside potential. So I think that's very important for us. Again, I want to repeat, we have to shift most of our long-term saving to parts. So I think that's okay for the future. Last but not least, you can find that our product is very diversified. Actually, our premier agency, they position themselves as a lifetime partner and advisor. So we are not just sell product, we are selling the total solution, we are selling the proposition. We provide high professional advisor service, innovative product, relevant value added services supported by solid ecosystem. Again, I would highly recommend you can watch my presentation. That includes what we are doing for the I cite the two typical examples, how we sell the CI product, we innovate the product from CI 1.0 to 2.0 to 3.0, supported strongly by the case management, by the prevention, by the ecosystem, by the hospital network. So I think that this combination actually well position us to capture the customer needs So even in the low intrinsic environment with participating product, with all this combination, we have confidence to further satisfy the customer needs and we think the market potential is still huge. Thank you.

I just add that in China because we are focused on serving the needs of middle class and affluent families in the major cities, We've seen that these customers in terms of their shift in attitudes, there's a distinct shift towards buying insurance. I think there's increasing propensity of middle class and affluent families in mainland China to buy insurance and buy insurance from trusted companies like AIA. So the demand for our products, despite the various rounds of repricing, the demand for products remains very strong.

I think the last question is for Garth on interest rates.

Yeah, thanks Leon. As you say, interest rates fell really right at the end of last year and they've remained fairly stable during the first half. So to that extent, it's behind us in the numbers. If you look in pages 84 and 85 of the deck, you'll see in free surplus, the investment return variances were negative 0.5%. That's largely Thai equities and not China. And then if you look underneath on page 85, you'll see the investment variances and others is plus 0.1 on the regulatory capital, required capital. So in China, we hold additional reserves that eliminate the 750-day averaging effect that comes through. because we've got the mark to market on the assets we think it's right that we take that into account as well. So that's already been accounted for and therefore you can say that at current rates it's behind us.

And I think just to reinforce what we said at the full year on China in particular in terms of our EV methodology is different from most other companies that We start at the spot rate and grade over a long period for our long-term assumptions. The same is true for Thailand, clearly. And so the movement in Thailand interest rates is now baked in at the half-year point. With that, we are out of time. So thank you, everybody, for listening. Thanks for your questions. If you've got any follow-up questions, please come through to AIM, Investor Relations. We're around, obviously. So thank you very much.

Ladies and gentlemen, this concludes AIA's 2025 Interim Result Q&A sessions. Thank you for your participation.