Aia Group Ltd S/Adr

Good morning and thank you for joining AIA's 2025 Annual Results presentation. Today we have announced record results with double-digit growth in new business, earnings and cash generation, and a new share buyback of $1.7 billion. This performance demonstrates AIA's ability to convert our competitive advantages into strong growth for shareholders. Let me start with the financial highlights. Value of new business increased by 15% to a record $5.5 billion. EV equity rose to $79.7 billion, up by 14% per share, and this is after returning $4.7 billion to shareholders during the year. Underlying free surplus generation grew by 11% per share, and operating profit after tax was up by 12% per share. on track to meet or exceed our 2026 growth target. The Board has recommended a 10% increase in the final dividend per share and approved a new share buyback of $1.7 billion in accordance with our capital management policy. As you can see, we are delivering compounding new business that drives both cash generation and earnings growth. This performance reflects the execution of a clear and consistent strategy. It is fully aligned with Asia's long-term structural growth drivers and built on competitive strengths that are developed and enhanced over many years. Each of these strengths reinforces the other, and taken together, they are incredibly difficult to replicate. And this is what gives me confidence in AIA's ability to capture the significant opportunities across our markets. You can see this most clearly when we look at our individual businesses. In Hong Kong, we delivered record VOMB of $2.3 billion, an increase of 28%. Our premier agency continued to lead the market with almost 25% of agents achieving MDRT membership. Agency contributed 70% of Hong Kong's VOMB, growing by 26%. This reflected a 9% increase in active agent headcount and a 14% rise in productivity. New recruits grew by 12%, supporting growth in future capacity, while MDRT qualifiers rose by 20%, reinforcing our focus on professionalism and quality. Partnerships VOMV in Hong Kong grew by 46%, Within this, Bank Assurance delivered 41% growth supported by improved customer targeting and higher productivity. And our RFA and broker channel grew by 49% from deeper engagement with preferred brokers driving an increased share of wallet. Demand remained very strong from both domestic and mainland Chinese visitor customers. Across both segments, our focus is on sustainable growth through regular premium protection and long-term savings solutions. The domestic business, which accounts for around half of our VOMB, grew by 21%. The outlook for future growth is strong as we add new customers and deepen relationships with our 3 million existing customers, meeting even more of their needs. VOMB from mainland Chinese visitors increased by 35%, mainly driven by sales to more than 50,000 new customers. We now have around 530,000 MCV policyholders, highlighting the enormous potential remaining for future growth from new and returning customers. With the leading distribution platform and a comprehensive product range, AIA's Hong Kong business is exceptionally well positioned to meet growing demand well into the future. Moving now to AIA China. BOMB in 2025 exceeded $1.2 billion. For the full year, growth reflects economic assumption changes, but momentum accelerated materially in the second half to 14%. This strong momentum has continued into 2026 with combined VOMB for January and February up more than 20% year-on-year. AIA's geographical expansion in mainland China provides a unique long-term growth opportunity. Since 2019, we have established operations in nine additional regions, including four new launches in 2025, adding almost 200 million potential customers within our target market. VOMB from these new regions increased by 45% to $118 million, accounting for more than 9% of AIA China's total. Looking ahead, We expect VOMB from new geographies to grow by 40% per annum over the next five years to more than $600 million by 2030. Our differentiated professional premier agency sets AIA China apart, contributing 85% of VOMB in 2025. Agent productivity is three times the market average, built on long-term relationships and the provision of personalized advice. This results in a more advantage product mix and an industry-leading VOMB margin of 65%. Our premier agency model is fully digitally enabled and increasingly powered by AI. This helps to raise professionalism as we attract and retain the best candidates while driving scale and productivity. In 2025, active agents increased by 8% and new recruits grew by 14%. New agency leaders were up by 40%, strengthening the foundations for continued growth. Alongside agency, Selective bank partnerships broaden our reach in the growing affluent and high net worth segments, delivering higher average case sizes and attractive profitability. Our solid foundation and strong momentum give me confidence in AIA's ability to capture the large and growing opportunity in mainland China. Turning to ASEAN, where AIA is the number one life and health insurer. We delivered VOMB of $2 billion in 2025, representing 34% of the group's total. Thailand, our largest market, achieved VOMB of $1 billion, up 13%, driven by a strong agency performance and double-digit growth from partnerships. We have also provided a separate presentation on AIA Thailand's growth strategy, setting out how we intend to capture the tremendous life and health insurance opportunities in that market. VONB from Singapore increased by 14% to over half a billion dollars, with agency growth of 10% and partnerships up 31%, including strong momentum from offshore business. In Malaysia, Performance improved in the second half as agency productivity and recruitment began to recover. Partnerships DOMB grew by 17% in 2025 with strong results in bank assurance and our market-leading corporate solutions business. Across ASEAN, Premier Agency is our main source of new business, delivering a high-quality product mix, and we are the leader in protection products across the region. Overall, the quality of our distribution and product mix position AIA well to meet the evolving customer needs across the region. In India, Tata AIA Life delivered another excellent performance with VOMB increasing by 33%. The business continues to focus on quality, ranking number one for persistency and retail protection. Our agency is the market leader and contributed around 60% of VOMB. Agency VOMB grew by 44%, supported by improvements in activity levels, leader development and recruitment. Bank and broker partnerships are complementary to our agency distribution, extending customer reach and driving additional strong growth. Overall, Tata AIA Life's focus on protection, discipline distribution and consistent execution ensure we are well on our way to capturing India's huge potential. Across the group, this consistent focus on quality distribution underpins our performance. AIA's proprietary premier agency is the core driver of profitable new business, contributing 73% of the group's total VOMB. Our agents build lifelong relationships with customers, focus on meeting evolving needs through trusted advice and best-in-class products. We have the world's leading type agency. which has been the number one MDRT globally for the last 11 years. This is the outcome of a differentiated strategy, honed over decades, that supports high quality profitable new business growth, attractive agent incomes, and higher shareholder returns. The success of our model is self-reinforcing, as it helps us to hire and retain the best agents, further extending our industry leadership. Continued investment in talent development and advanced digital tools has driven growth in agent numbers and a step up in productivity. This has laid the right foundations to further strengthen our Premier Agency leadership through the use of artificial intelligence. Our agents provide ongoing reassurance and support through face-to-face guidance that helps individuals and families navigate complex choices and adapt as circumstances change. AI enables deeper customer engagement and helps agents focus on what matters most. High quality, tailored advice, grounded in empathy, accountability and understanding. AIA+, our all-in-one customer super app, now manages interactions for more than 23 million users, providing powerful insights on needs and preferences. In 2025, our customer data mart captured and structured around 200 million customer interactions, enabling advanced analytics and more personalized and targeted engagement. As a result, We provided 5 million actionable leads to agents with a 17% conversion into sales. These leads generated more than $2.1 billion of VOMB. This highlights how technology and analytics are amplifying our long-term advice-led model, supporting higher productivity and sustainable growth across our distribution. Fast-growing partnerships extend our reach to hundreds of millions of potential customers through strategic bank partnerships. We focus on selective, high-quality partnerships aligned around shared growth ambitions and long-term value creation. By integrating AI's technology and analytics capabilities into partner channels, we are able to improve customer targeting proposition relevance and productivity. As a result, Bank Assurance VOMB has more than doubled over the past three years from higher numbers of active insurance sellers, increased productivity and enhanced profitability with 45% margin. Together, our agency and partnership channels create a powerful distribution model that supports long-term growth and advances our purpose of helping people live healthier, longer, better lives. By delivering protection and long-term savings solutions that support financial security at every stage of life, we help customers guard against unforeseen risks, accumulate wealth and plan for the future. And we do this through best-in-class products, combined with an ecosystem of health and wellness services that is backed by personalized professional advice. In 2025, we added 2.3 million new customers, while existing policyholders accounted for around 50% of the group's new business through repeat purchases. 91% of the group's VOMB comes from protection and fee-based insurance products, ensuring sustainable and resilient earnings and cash generation for AIA's shareholders. In closing, today's record results demonstrate that we are executing a clear strategy that leverages our core strengths, deepens our competitive advantages, and delivers sustainable shareholder value. Our ambitions are bolder than ever, and the scale and resilience of our business ensure we are well-placed to realize AIA's full potential. I will now hand over to Garth, who will take you through the financial results in more detail. Thank you.

Good morning, everyone. I'll now take you through our excellent performance with double-digit growth across our key financial metrics. VUMV increased by 15% to $5.5 billion, driving EV equity up by 14% per share to $79.7 billion after returning $4.7 billion to shareholders during the year. UFSG, our key operating measure of cash generation, rose by 11% per share, while under IFRS, operating earnings were up 12% per share. Through strong profit growth and our disciplined capital management, both operating ROEV and ROE increased to over 15%. Following the Group's excellent performance, the Board has recommended a 10% increase in the final dividend. This brings the total dividend for 2025 to HK$193 per share, also up 10%. Under our established capital management policy, the Board has also approved a new share buyback of $1.7 billion. The increased dividend and new share buyback reflect our confidence in AIA's future prospects and financial strength. I will go through more details of the financial performance in three sections. First, the embedded value results to show how we create shareholder value. AA's growth strategy is focused on running profitable new business, which compounds over time to support higher earnings and cash generation for the long term. VOMB was up 15% from 9% AMP growth and a 3.6 percentage point increase in VOMB margin, driven by proactive product mix shifts and repricing. Agency distribution was the group's primary growth engine, delivering a 13% increase in VOMB. Partnership distribution grew by 22%, including strong double-digit growth from both bank assurance and our intermediated channels. With the majority of our markets delivering double-digit increases in BNB, we again saw broad-based growth in 2025. AA's product strategy creates value for both our customers and our shareholders. Traditional protection products generate underwriting profits that are not dependent on capital market movements, while participating and unit-linked solutions generate stable, fee-based insurance income. Over 90% of our VMB is generated from these most attractive product lines, with very low average guarantees and strong and predictable cash generation. Our new business is capital efficient, with $3.8 of VMB generated for every dollar invested. And as we've reduced capital intensity, so the ratio has increased. The financial profile of new business is very attractive, with rapid emergence of distributable earnings, driving high IRRs and short payback periods. Our capability to deliver large-scale, high-quality, profitable new business sets AIA apart and underpins our confidence in the group's future growth. By consistently adding layers of profitable new business, supported by prudent assumptions and active management of the Inforce portfolio, we grow EV equity and, in turn, cash generation. Higher VOMV was the main driver of a 13% per share increase in EV operating profit to $10.9 billion. The successful execution of our integrated healthcare strategy and disciplined expense management supported greater positive operating variances, which added over $300 million to EV operating profit. As a result of the strong growth in operating profit, ROEV increased by 90 basis points to 15.8%. Over the year, EV equity increased by 14% per share, after 4.7 billion paid to shareholders through dividends and buybacks. EV operating profit was the main contributor to the higher EV equity. Investment variances were positive, following an improvement in the second half reflecting favourable equity market movements in mainland China, Hong Kong and Thailand. Positive non-operating items of 1.7 billion mostly represent the effect of exchange rates. Dead of shareholder returns, EV equity finished the year at 79.7 billion. AA's strong track record of positive operating experience demonstrates the prudence in our assumptions and the quality of our in-force business. Overall, consistently favourable operating variances have added $4.4 billion to EV equity since our IPO. While AA is not immune to capital markets, you can see from the small sensitivities shown here that our EV remains highly resilient to short-term market volatility. A 50 basis point increase or decrease in interest rates has less than 1% impact on the group's embedded value. We also have a substantial allowance for risk in our discount rates, making EV equity a prudent estimate of the economic value to shareholders from the Inforce business. Similar to our new business, future earnings from our Inforce book are predominantly sourced from protection and long-term savings products, which provide recurring and resilient cash flows. The Inforce is highly cash generative, with earnings continuing for decades into the future. Over $53 billion is expected to emerge over the next 10 years. This figure is up 14% over the year as we added another layer of high-quality new business. Our strong cash generation allows us to both increase returns to shareholders and reinvest in growing new business, which further expands our stock of future earnings. UFSG is our key operating measure of cash generation and is shown before reinvestment in new business and central costs. The key component of UFSG is the expected distributable earnings from the Inforce business, which increased as we added new business written over the year. As a result of our proactive Inforce management, operating variances improved compared with 2024. After allowing for the first time effects of global minimum tax, UFSG grew by 11% per share. Moving on to the IFRS results. Similar to embedded value, continued growth in high-quality new business adds successive layers of future profit to the CSM balance, which is gradually released into earnings over time. New business CSM grew by a very strong 17%, and underlying CSM growth accelerated to 10.5%. Together with positive variances and currency effects, the CSM balance increased to $64.9 billion at the end of 2025. As a result of a stable release rate and the larger stock, the CSM release increased by 10% to $6.2 billion. The CSM release remained the principal contributor to OPAT, our core measure of operating earnings. Operating profit after tax increased to $7.1 billion. The higher CSM release and positive operating variances drove an 18% increase in the insurance service result. which added more than $1 billion to OPAT. This was partially offset by a small reduction in the net investment result, reflecting the effect of share buybacks, higher financing costs and tax. Overall, OPAT increased by 12% per share, putting us on track to meet or exceed our 2026 target. Strong growth in OPAT and our ongoing capital management actions supported a 70 basis points increase in operating ROE to 15.5%. After returns to shareholders, allocated equity increased by 10% per share to $47.5 billion. Comprehensive equity adds the CSM, on a net of tax basis, onto shareholders' equity. which provides a more economic view of shareholders' equity by including the value of future earnings. Comprehensive equity increased by 15% per share to $97.9 billion at the end of 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. In addition, we look to return capital to shareholders that is surplus to our needs, while retaining sufficient financial flexibility to capture the huge growth opportunities available to us. AA's clear capital management policy sets out how we deliver sustainable and growing returns to shareholders over time through dividends and share buybacks. Strong growth in UFSG supported an increase in net free surplus generation of 14% per share. As I mentioned earlier, despite the strong increase in BOMB, a proactive shift towards less capital-intensive products, most notably in mainland China, saw a reduction in new business investment to $1.4 billion. Adjusting for unallocated expenses, finance costs and other items, net free surplus generation was $4.5 billion. As intended by our capital management policy, the shareholder capital ratio reduced over the year and remained strong at 221%. With respect to the 2025 financial year, total returns to shareholders under our capital management policy amount to $4.3 billion. Based on our excellent financial performance, the Board has recommended a 10% increase in the final dividend per share, which results in total dividends of $2.6 billion for the year. The Board has also approved a new share buyback of $1.7 billion. This comprises $0.7 billion to meet the 75% net FSG target, and an additional $1 billion following a further review of the Group's capital position. In aggregate, total returns to shareholders in respect of the 2025 financial results are $4.3 billion, up 13% per share compared with 2024. Our ability to write large-scale, high-quality and profitable new business with a very attractive financial profile is a key differentiator for AIA. Successive cohorts of profitable new business compound over time, adding substantial layers of recurring earnings to our large in-force book, driving UFSG and OPAC growth. With another excellent financial performance in 2025, we delivered double-digit growth across our key financial metrics of growth, earnings and cash generation, and further extended our strong track record. Since 2010, dividends and share buybacks now amount to $40 billion, We believe that AIA's ability to deliver compounding growth across new business, earnings and cash sets us apart. 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. Our strong balance sheet, financial flexibility and clear growth strategy give us great confidence in execution. We're 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 that in turn will generate highly attractive returns for shareholders well into the future. Thank you.

Good morning from AIA Central in Hong Kong and welcome to AIA's 2025 Results Analyst Briefing. My name is Sami Taipoulos and I'm delighted to be joining you today in my new role as AIA's Chief Investor Relations Officer. With me on the stage today, we have Li Yongxiong, Group CEO. Garth Jones, Group CFO, and other regional chief executives, Jackie Chan, Fisher Zhang, Hak-Lei Tan, and Leo Grepping. We also have other members of the Group Executive Committee with us in the room. Before we begin the Q&A session, I want to highlight that we have a separate video on A Thailand's growth strategy, which we published on the website today. If you haven't had time to look at it yet, please do so later. We will now begin the Q&A session. If you want to ask a question, please make sure that you're logged in to the Zoom webinar. Operator, over to you.

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 now. And our first question comes from Thomas Wang of Goldman Sachs.

Thomas?

Yes, thank you. Thank you for the opportunity to ask a question and then congratulate on the result. If I have two questions, firstly, so I think we welcome definitely the color on 2026 for mainland China in the first two months, also for Thailand on the first quarter. Just wondering if you could give us some color on Hong Kong, because that's obviously very, very strong growth in 2025. How do you see growth momentum trending in the first couple of months, and what's your outlook? And the second question, thank you for the additional video in Thailand, around Thailand. It's definitely a highlight over the last few years. Just wondering, I'm sure you're working on expanding some of the initiatives that you deploy in Thailand into other markets. I'm just wondering, from your perspective, how you think about that success in Thailand? How much is kind of down to your execution and then what how much sort of the market specific factors that played into your success the reason i'm asking is that if you deploy obviously uh if you deploy some of the initiative to other markets uh they may not be successful as as in thailand so i'm just trying to get a sense so how much you may need to kind of fine-tune that strategy in other markets uh thank you

Thank you, Thomas. I'll just start with a few comments and I'll hand over to Jackie on Hong Kong. Very happy with our performance by Hong Kong. We developed very broad-based momentum across customer segments and excellent performance across all distribution channels. As you know, we have the market-leading agency force, which contributes to 70% of AIA Hong Kong's VOMB. Number one, MDRT, 25% of our agents in Hong Kong are MDRT qualifiers, and all the fundamental drivers of agencies are performing strongly. In terms of demand, we are very positive on the outlook for demand growth, both in domestic and MCV segments.

I just want to add that the A Hong Kong and Macau momentum is very strong in 2025. First half, R&B grew by 24%, and second half, R&B grew by 32%. And we launched innovative participating product in July last year, and that was getting a lot of attraction. and also traction in the market, and that actually continue. And we continue to see that both our premier agency and our selected partnership with both our bank assurance partners, Citibank, BA, and our selected partners in the IFM brokers area, all these channels continue to maintain strong momentum going into the first quarter of this year.

Thank you, Thomas. Also on Thailand, clearly Thailand is a very important market for us and Thailand has delivered strong performance in 2025. BOMB growth of 13%. In fact, Thailand has been growing consistently over many years. Our BOMB in 2025 was double the level of 2019 pre-COVID.

Thank you very much. ... ... ... ... ... ... ... In fact, our market-leading AT channel continues to grow in scale and productivity, with an increased market share of close to 44%. That's why our strategic partnership, Update Bank and the Bank of Bank, grow in productivity as well as pay size through our separate focus on this very thing. Overall, we are clearly doing a very strong record of delivery.

And as you can see from the presentation that was uploaded this morning, we have a very clear goal strategy to be able to compete with each other. Thank you, Harlan. So I do encourage I do encourage you all to watch the video.

Thank you, Thomas. I do encourage you all to watch the video on Thailand. If you look at the video, you'll see that a lot of what we are doing in Thailand is very similar to what Fisher introduced in the China video last year. So this demonstrates that we are learning from the best practices across our markets and industrializing it across the world. The EIA group, yeah. Thank you.

Sure. The next question comes from M.W. Kim of JPMorgan. M.W., please click the unmute button and ask your question.

Good morning. Thank you for the opportunity. I would like to ask two questions, one on solvency capital and one on India. Firstly, following the strong capital return, the solvency ratio lowered to 221% as of December 2025. With a more ambitious growth initiative planned for 2026 and additional share value-back announced, Could you please share your year-end solvency ratio projection? Is 200% of the required capital still the company's target capital ratio? On India, The India JV delivered another strong new business value increase, 33%. Could you please share the timeline for providing stand-alone disclosure on India business? Additionally, do you view the regulatory environment, including GST, the exemption, and potential changes to upfront sage commissions, as supportive of your growth outlook in India? Thank you.

Thank you, Kim. I will just start again with a few comments and I'll hand over to Gav on the capital question. As you know, we have executed consistently on our capital management framework over the recent years, leading to a much more optimal balance sheet and higher returns on capital. So maybe I'll hand over to Gav to elaborate.

Yeah, thanks, MW. You can see that the capital management framework that we set out is doing exactly what we expected it to. You have the 75% of net free surplus generation, the increase in the dividend, prudent, sustainable and progressive. and an additional $1 billion. That brings the total payout to $4.3 billion for the year, which is up 13%. With the payout, you'll see that the shareholder capital ratio reduces. I should say that the 200% that we have mentioned before, it's not an absolute limit. It's not a target. It's a measure, and we say we want to be comfortably above that 200%. It may dip below that in certain stress situations, but we look at the situation as that happened. I think the key thing is for us that we're actively managing the balance sheet, actively managing the capital position. You see the strong OPAC growth, 12% OPAC growth. It's in excess of our 9% to 11% OPAC target. We're on track to either meet or exceed that OPAC target. combined with the capital actions we've taken, have driven an increase in ROE up to 15.5%. And with that, you can see that we are doing all we can to create shareholder value by not only growing the business, but actually managing the capital position to an up-to-all place. We remain very strong. You see good flows from the businesses, good remittances, whole core cash is good. So overall, the business is in a great financial shape and we're very confident about the way it will look in the future.

On India, another excellent performance with BOMB up by 33%. So hand over to Leo to discuss India further. Thank you. Hi, good morning.

Thank you for the question on India. As you've noted, we've been delighted by the performance of our joint venture this year. As Yancyan mentioned, up 33%. That growth has been broad-based across our agency channel, which was up 44%. which was up 44% last year, with very strong quality of the business, very strong recruiting double-digit, leader growth double-digit, active agents double-digit. And then also our partnership distribution channel, which also showed 21% growth last year in VONB. And on the back of our bank partnerships where we're seeing increasing productivity of our insurance specialists as well as our brokerage partnerships where we continue to have the number one wallet share across the leading brokerage firms. So very broad growth and importantly for us, very high quality growth. Our agency remains number one in MDRT in the country. We remained number one in persistency, and we're very focused on growing protection, which is reflecting on us being the number one life insurer in terms of retail sum assured. So, overall, very strong momentum for the business, and you referred to some recent regulatory changes and as well as broader reform. Broadly, NW, we view this as quite supportive of the growth of the industry. The recent GST reform, in our view, is a progressive step in increasing affordability for life insurance in the country and supporting the development of the industry. Similarly, we've seen an amendment of the Insurance Act in December of last year with, for example, some measures to increase foreign investments in life insurance in India. And we see all of these as liberalization of the industry, which we think will be conducive to continued profitable growth. Thank you.

Great. Before we go to the next question, we understand that there's been a bit of an audio issue, so we're going to repeat the answer on Thailand that Hathaway gave earlier.

Thank you. AI Thailand delivered another year of strong VNV growth. The VNV was up 13% to $1 billion, which is more than double the pre-COVID level. Our market leading agency force in Thailand continue to grow in scale and productivity. We've been number one MDRT in the market since IPO. And by end of 2025, our market share of agencies in excess of 40%. Partnership distribution continue to grow strongly. Our strategic partnership with Bangkok Bank grow in case size as well as activity. built upon our segment-focused strategy for the bank's various customer segments. As you can see from the presentation that we uploaded this morning, AIA Thailand remains a clear market leader with an extremely strong track record of recovery of delivery. Apologies. We remain very optimistic about the growth potential in Thailand and we have a clear strategy that's built upon our various competitive advantages to fully serve the Thai market.

Thank you.

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

Hi, good morning. This is Charles Zhou from UBS. I have three questions. First of all, I think congratulations for a solid set of results. The first one is about AI. I think in U.S. and European markets, AI is making material progress in reshaping the insurance industry, such as AI automated insurance distribution and also autonomous driving, etc. So how do you view the potential AI disruption on AIA? And also, could you please maybe briefly outline the key AI use cases already in place today, and also how your AI strategy could evolve over the next couple of years? My second question is about the growth outlook for the whole group. I think for 2025, the 15% growth was strong, although part of that reflects some temporary tailwinds. For example, the regulatory changes in Hong Kong, second, third quarter, and also first quarter in Thailand. So looking through those one-offs, how confident are you in sustaining the mid-teens value of new business growth this year? And also, what are the key growth drivers behind? My last question is related to China. On page 8 of your slide for China, I've been glad to see very strong momentum of over 20% value of new business growth year-on-year in the first two months. So may I know if it is largely driven by bank assurance? The major domestic peers are accelerating the bank assurance development to capture the so-called deposit migration opportunity. But I think AI has been focusing on the premium agency and protection products. So what is your distribution channel strategy and also how do you view the deposit migration in China? Thank you.

Thank you, Charles. I'll take the first question on AI and then I will hand over to Fisher to talk specifically about how we are using AI in China. Very excited on opportunities for AI. I think it aligns and it augments and elevates our agents' core proposition. which is providing trusted and personalized advice and will definitely improve efficiency and productivity. Over the years, the more than $800 million of TDA investments that we have put in has placed us in a very good position. Our strong technology foundation Our large pool of structured data enable a range of AI and digital tools that are already delivering benefits to the business. We have the scale, we have the industry knowledge with the proprietary data with the financial resources to work alongside leading global technology providers to further improve distribution productivity, customer experience and operational efficiencies through the use of AI. Our premier agency offers personalized advice on products which are critical to customers' physical and financial well-being in a highly regulated environment, making trust and accountability a key to our offering. And this is hard to replicate with tech alone. We believe that AI will augment and elevate our premier agents, you know. I'll hand over to the official to talk a bit more about how AI is empowering our agency force in China.

Okay. Let me quickly talk about how we use AI to continue to transform our Pyongyang agency. As you know, there are two major development journey for the agency. One is the sales and the other is the leader development. For the sales journey, as I introduced in the interim result, in addition to the normal AI training, AI recruitment, AI role player, we are able to provide the leads to the agent, help them to nurture needs from the cold to warm to hot and provide with actionable customer insight. And since then, we continue to evolve. Now with advanced agency data mark, we are able to provide aging with personalized development plan, benchmarked against those successful MDRTs. and write down our advanced customer data mark and for each agent or customer, we can develop a personalized engagement plan, including how to better serve, how to better engage, how to upsell and cross-sell. We already saw some early impact. One indicator for the new agent success has been improved 20% in 2025. As for the leader development journey, the similar logic and similar approach We are now able to provide the leader with a personalized development plan benchmark against those successful leaders. And for their team members, we can provide the leaders with predictive insight based on the leading behavioral data, and also we can provide each member the personalized development plan. As you can see, our number of new leaders has increased by 40%, which is great in the last year. I think AI support is a key enabler. So with more data, enriched knowledge library, enhanced capability, we are developing intelligent AI. It will be no longer, you know, just a passive system. It will be a partner and advisor. It can provide the, you know, timely, proactive, personalized, and predictable support to agent and the leader. I think AI definitely will transform the agency channel and will definitely increase the agency value and the customer value significantly in future.

Thank you, Fisher. Just to add on to this, Fisher's sharing by saying that we have actually set up a dedicated group innovation office in 2024. to provide a very structured approach to launch prototypes in individual markets and to industrialize it across our markets. And you see some of what Fisher discussed about in China in our Thailand video as well. Now on your question about the growth outlook, I just want to say that we are confident about very confident of our outlook going forward. We achieved very strong results, record DOMB and the growth accelerated in the second half, all this supported by very strong foundational drivers. The growth, as we discussed today, was broad-based. We have a diversified Pan-Asian platform, very attractive markets with high growth potential. In the majority of the markets, we have a leading market position. We have the world's leading primary agency channel, and this is our core growth engine. 73% of our groups at UMB comes from our primary agency channel. And we have a complimentary profitable partnerships which provide additional revenue streams for AIA. As you know, we are very focused on writing high-quality new business with a very high-quality product mix with very attractive new business economics. And I would also like to say that I believe that we also have the best talent in the industry in the region with very strong execution focus. So this gives me the confidence in the outlook for AIA going forward. Thank you. On your third question on China, again, China delivered a record BOMB of $1.2 billion in fiscal year 2025. Very happy to see momentum recover. Actually, last year when we reported on the first half of 2020, The 2025 for China, we explained that driven by economic assumption changes, the growth was impacted, but the underlying growth of the business was very strong. And in 2025, second half, we saw the growth return to 14% and the momentum continued into 2026, January and February. And this growth is driven by across the existing and new geographies and also across the primary agency and bank assurance channels. I'll hand over to Fisher to elaborate.

Thanks for the question. I think there are several questions here. Number one, you asked about January and February. The answer is quite short. The momentum of the agency and the banking channel are all very good. So it's driven by both channels. And the agency remains the core channel and the core contributor for the growth. So that's the number one question. Number two, you asked about the channel strategy. I think particularly in the bank insurance, I know quite a lot of the domestic companies are pushing more the bank insurance. I want to mention a couple of points. I think the bank insurance channel, as you know, is getting more healthy because, you know, some regulatory requirements like Baoqing He Yi, which is kind of alignment with reporting and actual use of the the expense, and also reduce the bank fee, reduce the PIR, and now gradually shift the path so the bank insurance is getting healthy. But number two, you know, our strategy is to view, differentiate the profitable technicians. So we keep emphasizing that our strategy is we work with the selected partners. We are doing the deeper collaboration. We focus on those affluent and high-net-worth customer. And very importantly, you know, We clearly implement those activity management and we now exploring the data-based customer driven strategy. So I think as you can see, our benefit channel, the profit margin, revenue margin is 36% in the last year. So that's our band strategy. But last but not least, I also want to emphasize the premium agency is still our core strategy, is still our core advantage, our main channel strategy. I'm very pleased to see the solid growth fundamentals in 2025. As you can see, our number of active new agents increased by 20%. our number of new leaders increased by 14%. That laid a very good foundation for the future growth. So overall speaking, regarding the channel strategy, I think the premium agency is our core channel, and the differential of profitable bank accounts is highly complementary. The third question is talking about the deposit migration. I think firstly we do notice this trend and I think it's a good opportunity for the life insurance industry because now more customers are willing to consider the insurance and in particular we also notice that you know high net worth is a unique opportunity that's why we continue to strengthen high net worth solutions We continue to strengthen our high-net-worth ecosystem, those innovative position, and also the ecosystem of best service. Lastly, I also want to emphasize our response to the deposit migration is very selective and disciplined. As you know, our product strategy, we focus on the protection and the long-term saving. We try to provide a comprehensive of the product and supported by those ecosystem-based service and together with our professional advice service to satisfy the customer with different needs at a different life stage and financial stage. So we are not volume driven. So we are speaking, I think, for this, our attitude is we are and try to make use of this opportunity by remaining committed to our core strategy.

Just a minor correction to Fisher's answer. The WMB margin of our bank assurance channel in China is 35%.

Thanks, Charles, for the question. Let's move on to the next one.

The next question comes from Kalish Mishring from Deutsche Bank. Kalish, please press the unmute button shown on your screen and ask your question.

Good morning. Thank you for taking my questions. First one, simple one, active agent numbers, how did they change in Thailand, Singapore and Malaysia? Number two, Singapore MBV. What proportion of that comes from offshore? Why do customers buy offshore products in Singapore? Is it similar to Hong Kong? And where are they coming from? And what's the outlook for that growth in that offshore segment? And then on the share buyback, just coming back to the earlier question, if I look at slide 97, is the way to think about this that at the end of the year you bring the solvency ratio back down towards 200% and then the following year you reload and then do it all over again? Is that the best way of thinking about how you distribute this excess amount above the 75% payout ratio? And then, sorry, lastly, just on coming back to AI and tech, obviously you've done a lot of great stuff through your TVA initiatives, et cetera, to prepare for this. But specifically, how are you thinking about the threats and the opportunities from these LLMs, you know, that may end up – moving the younger generation towards greater personalization and or price comparison, so on and so forth. Thank you.

Thank you for your question, Kailish. Good to see you again. Good to hear from you again. Yes, Premier Agency is our core distribution channel. We have the world's leading agency and contributes 73% of group VOMB. We have number one MDRT globally for the last 11 years. consecutively and number one in many of the markets that we operate in, including the markets that you referred to just now. So in terms of active agent numbers, I'll hand over to Jackie to talk about it.

In fact, we're happy to say that we keep tracking all our PM agency across our business unit. And if you look at our slide 12, you talk about growing headcount, growing new recruit, growing new leaders, and growing new active agent productivity. I just want to add that our number of active agents did have consistent growth across our major market. So Thailand, Singapore, Malaysia, too.

Thank you. And then I hand over to Hagley to talk about Singapore. Again, Singapore delivered very strong results in 2025.

Thank you, Insung. Thank you, Talish. Yes, Singapore delivered a strong VNB growth of 14% in 2025, which was the third consecutive year of a strong double-digit growth. As you can see, we have a very broad-based approach in Singapore. It's a multi-channel distribution with agency remain the core. Our agency force has been number one MDRT for 11 consecutive years and continue to grow in both quality and scale. The number of new recruits increased by close to 20% in 2025. Likewise, we also saw a very healthy growth in number of new leaders. Just in terms of the mix of business, as I mentioned, we have a very broad-based business. We serve both the domestic as well as offshore market through our agency channel as well as partnership distribution. Our product mix span the traditional product, unit length, as well as participating product. Singapore being a financial hub, we experience strong growth in offshore business, mostly from the region. But I would say overall, the businesses in Singapore are still majority from the domestic market to meet their both protection and long-term savings needs.

Thank you.

Yeah, thanks Kailash. I think with the capital management framework well set out, you can see that the net free surplus generation piece is dealt with through the 75% mechanism. And then what we do is we look at the situation each year where we are and look if there's anything in excess of that that we will return to shareholders. You saw the additional billion dollars that gave us $1.7 billion overall for the buyback today. I think we're obviously very comfortable with the 200% level, and we assess that. In some ways, it's the mechanism that makes it more accessible, Carlish. I think one thing that perhaps helps is to say that we tend to think of it in terms of the absolute amounts. I think the disclosures you referred to will show how the absolute amounts of each item have moved, including just natural growth in the business. I think that's probably a better guide for you.

Yeah, and on your question on AI, as I explained earlier, I'm very excited about the opportunities afforded by AI to augment and elevate our primary agency channel. As I explained, our primary agency channel, our agents offers personalized advice on products which are critical, to customers' physical and financial well-being in a highly regulated environment. So trust and accountability is key to our offering and this is hard to replicate with technology alone. In fact, a customer survey that we did recently tells us that 85% of our surveyed customers still prefer advice from trusted advisors and only 2% will opt for pure digital or AI services. you know, model. So again, you know, we believe, you know, that the investments that we are making into AI, as described by Fisher, you know, will really elevate and augment our primary agency channel.

Great.

Operator, next question, please.

The next question comes from Leon Chin of CRSA. Leon, please press the unmute button shown on your screen and ask your question.

Hi, thanks management for taking my questions. This is Liangqi from CRSA. I have three questions today, if possible. Firstly, I want to ask about the capital efficiency. I appreciate on our slides, page 21, we have a chart on our capital efficiency. Our BOMB per dollar generated from new business investment actually improved a lot. Just wondering how much it has to do with our new product mix. I do understand that, for example, in mainland China, our participating products is making a much a larger portion of all our products. So I just want to understand how much is the contribution from product mix and if there are other significant factors behind these significant capital efficiency improvements. And secondly, I want to ask about our Hong Kong partnership channels. Very good to see that last year, both our IFA and also Bank Assurance channel grew more than 40% year on year. Interestingly, earlier this week, one of the other Hong Kong insurers has given a very aggressive picture on the Hong Kong brokerage channel so far this year. And the other Hong Kong insurer seems to have a very different view on the market. So it will be very helpful for us to know our stance on the IFA channel in Hong Kong this year and what is our strategy in this channel. And thirdly, last but not least, I do appreciate our additional disclosure on Thailand and our dedicated video on this interesting market. We have highlighted both our FA and also Band Assurance channel in Thailand. But how do we try to materialize the significant opportunities there? I mean, other than Bangkok Bank, which has been very conducive to our results, do we have plans to explore new partners? what about broker channels there agency channel understand FA has been doing great any new initiatives on the product front so what's our plan for the next stage of our Thailand business which has been very successful over the past few years so what's next in Thailand thank you thank you Leon for your question I just start off by saying that you know you know

We are committed to designing products to address the protection, the long-term savings, life and health insurance needs of our customers across different life stages. We are also committed to writing profitable new business which will deliver sustainable cash returns to shareholders. So you can see that the new business economics of the new business that we write each year is very, very attractive. We have ample capital resources to support our new business growth ambitions. We outline our capital management plans and one of the priority uses of capital is really to support new business growth. Now, specific to your question on capital efficiency, I'll hand over to Garth.

Thanks for the question, Leon. You can see that the business is highly capital efficient. We've improved the capital efficiency progressively, not only in terms of the BOMB efficiency, but also if you think about it, the IRRs are still very attractive, short payback periods. And importantly, when you look at the cash return in the first 10 years, that we get a good cash return from the business as well. So very attractive reinvestment economics in terms of the new business. And that's the first port of call for any excess we have. To your specific question, you're quite right that the capital intensity, as it were, came down over the year. What is driving that, as always, is a mixture of product and country. It's not just product alone. On the product side, the biggest driver there was the move to participating products in China. On the country side, we clearly had more business in Hong Kong with its strong growth, our largest market, and that is very capital-efficient business. So there's a country and a product mix. But needless to say, we continue to look at ways in which we can improve the capital efficiency even further, product by product, country by country.

In terms of Hong Kong, we have a leading position in Hong Kong, the leading brand for insurance in Hong Kong. As I highlighted just now, very strong performance across customer segments, very strong performance across industries. distribution channels, our primary agency, our core channel. I'm very proud of this agency. 25% of our agents are MDRT qualifiers in 2025. And we have a very good portfolio of partners, whether it's bank partners or whether it's IFAs in Hong Kong that we work closely with. I'll hand over to Jackie to elaborate.

Thank you for the question. So I also take this opportunity to say that at Hong Kong Macau, we do have a strategy for RFA broker, which is a selected partnership with a high quality preferred RFA and brokers. So you know there are thousands of brokers in Hong Kong, but we don't contract them or we are very selective. And you also recall that early last year, AIA, Hong Kong, I think from now is still the only one. We have set up our requirement for the brokers to have transparency for referral fee payment to those cases that come from referral business. And as you know, the Hong Kong IA also set up some regulation requirements, including a referral fee cap, including a commission spreading. And for AIA, we have been spreading commission for brokers for years. We have been giving not just first year, but also spread it to renewals. So in fact, I'm very happy that since last year, with this strategy of partnering with preferred brokers, really drive up, I would say, its price to quality. And our share of wallet actually depends with our preferred partners. And the VNB growth from iPhone broker growth 49%. I want to say that this strong momentum continue into first quarter this year.

On Thailand, again, we are the number one life and health insurer in Thailand with the leading insurance brand. Our premier agency channel, which is our core distribution channel, again, has a dominant market position in Thailand. We are also working with a number of bank partners in Thailand. I'll hand over to Hartley to elaborate. Thank you.

Thank you, Yen Siong. Thank you, Leon, for the question. Yes, we are clear market leader in Thailand with significant competitive advantages across the wide spectrum of the business. As Yen Siong mentioned, our agency force remain our core distribution channel. We are particularly proud of the strong and continuous growth of our FAA program. FAAs are the program that grow highly productive and professional agents And FA is now contributing to more than 40% of our agency force, and our agency force is more than 40% of the industry. And despite that, we believe there is still significant room to grow both in scale as well as quality of our agency force in Thailand, so that we can serve the market, both the massive foreign as well as high net worth market even better. In terms of product proposition, Our focus has been on protection and long-term savings. In fact, in third quarter last year, we launched an innovative long-term savings plan for the affluent and high-net-worth segment, and that's gained very strong traction. In fact, by December 2025, our new product contributed to more than 10%. of our total long-term savings pieces, and we see enormous potential to further broaden the scope of our proposition to gain an even bigger share of the affluent and high-level segment as what we've seen in several other markets. So overall, with our clear market positioning and a clear strategy, as what you can see in the presentation that we uploaded this morning, we are very confident that AIA Thailand is uniquely positioned to continue to grow our business in Thailand and continue to serve the customers better.

Okay, thanks Leon for the question. Let's move to the next one, please.

Thank you very much. The next question comes from Gary Lam of HSBC. Gary, please press the unmute button shown on your screen and ask your question.

Thank you very much. Two questions if I may, one big, one small questions. The bigger question is perhaps, can we understand how does the management sort of see the impact from the Middle East conflict? Maybe part of that is I can see in slide 85, over the last year there's an increase in equity allocation from your investment portfolio. Would you, with some of the elevated market volatility, adjust the investment mix of the portfolio? I mean, more broadly, which are the key channels that you would focus on, like interest rate channels, distribution channels as a potential impact implications there? Question number two is part of a follow-up on the Hong Kong business. On VOMB, if my calculation is right, actually for the group, it might have slowed down to 10% growth relative to 18% or 19% growth in the first nine months. So can we understand the key driver underneath? Is it primarily on Hong Kong, China, and particularly on Hong Kong? I see, of course, Fisher's comment that we have been following the commission spread sort of rules similar to HKIAs. But what should we sort of as a understanding of the likely slowdown of Hong Kong 4Q VOAB momentum? I guess particularly maybe on IFA and Brooker Channel. Just try to differentiate what are the one-off factors versus whether it's a fundamental like just not as strong as before in terms of the momentum. Thank you.

Thank you, Gary. On the Middle East, like many, we are monitoring developments very closely. And we also, like many, hope for a peaceful resolution. We have no direct operating or investment exposure to Iran. And our exposure to the broader immediate east is very small and we have disclosed it this time now. So any impact to AIA would be indirect to movements in the global capital markets rather than any direct exposure. But given the very long term nature of our business, we manage our investments. through a disciplined asset liability matching approach. So this helps reduce the impact of market volatility on both profitability and our balance sheet. So also our AI, as you can see, we maintain a very strong capital position and we calibrate this against a wide range of very severe stress scenarios, which supports our resilience in times of uncertainty. So AIA, you've been around for a long time. We are long-term business, and we have proven to be very resilient through multiple cycles and challenges. So I think that's our answer for your question on Middle East. In terms of the performance of the group, again, like I said before, very strong performance in 2025, record B1B, supported by very strong foundational drivers. Second half actually accelerated, growth in second half accelerated versus first half. We have said many times there are many seasonal factors affecting quarters, so we don't really manage on a quarter-by-quarter basis. The foundational drivers of our business remain very strong, and we are confident of the outlook going forward. Thank you.

Thank you for the question, Gary. Let's move to the next one.

The next question comes from Michael Lee of BOA Securities. Michael, please press the unmute button shown on your screen and ask your question.

Thank you. This is Michael Li from Bank of America, and congratulations on the solid results. I have two questions. The first question is about private credit. So I see the slide you have on your slide. You disclosed the size. You disclosed the percentage. But I still want to confirm something that have you ever – Talk to your asset managers, those private credit asset managers, if any kind of liquidity limits currently in their funds and if any quality issues in their funds. And what kind of measures will take in the next few quarters in terms of private credit investment will increase or will decrease? The second thing is about China business. So I think Fisher answered the questions about China bankers' business. I think the definition of bankers in AIA and other insurers could be very different. You focus on your target clients, high net worth individuals, and the margin at like 35%. while others at like 10% to 15% margin. So my question is, are you interested in 10% to 15% margin bankruptcy business? Are you interested in the mass market in China if you want to develop your business in those less developed provinces? Thank you.

Okay, thank you, Michael. I think you have a specific question on private credit, but before handing over to Graf to talk about that, private credit, I just again emphasize that given the long-term nature of our business, so we manage our investments through a very disciplined asset liability matching approach. We have very long-term liabilities, very strong balance sheet and large recurring premium. So we have ample financial and liquidity flexibility. So private market assets actually form an attractive part of the overall matching strategy, providing us with enhanced long-term returns and diversification. So our private asset portfolios are diversified across strategies and across many asset managers. And we do a lot of testing. And in terms of liquidity requirements and stress test, we actually take a very conservative approach by assuming zero liquidity and no recovery value from our private assets. So we are quite comfortable with the quality and allocation of our private market portfolios. On private credit, actually, it's an even smaller proportion. Maybe it's about 11.

Yeah, thank you, Ian and Sean. I think, as you said, the stress tests are extreme. But you can see the key thing is that it's just 2% of our non-par and surplus assets. It's part of our asset liability matching, which we have a very disciplined asset ALM structure and so on. We're in constant dialogue with the fund managers. We only deal with a very large and a select group of managers, and not only in terms of their outlook, but where they're investing and so on. So we think if managed properly, private credit can be an attractive asset class. Perhaps I could ask our CIO, Chief Investment Officer, Dr. Mark Conan, to perhaps add a little more colour, Mark.

Thanks, Garth, and thanks for the question, Michael. Private credit, obviously, is an asset class that has grown very significantly as a result of changes in the regulatory framework, particularly in the United States in the banking industry. And we've kept abreast of those developments very closely. If you think about, as Yanceyong has mentioned, the underlying ethos of our investment program is to back our long-dated liabilities. both in terms of long-term returns, cash flow, FX exposure, duration exposure. In that context, private credit has a role to play, but it's relatively small, as Garth says, about 2% of the asset base. We have established a number of strategic relationships with key providers, largely in the US, but not only the US. And if you look back at our program, Fixed income really is a core competency within our organisation and particularly credit. We've developed our own credit capabilities for underwriting going back decades. And if you look across that period, we've suffered de minimis levels of default through that whole period and this is because of the quality of our underwriting, the risk controls that we apply and the constant reviewing and reporting that we have internally to make sure at all times we understand our exposure. We are extending that approach to private credit and our teams internally over the last several years have been working closely with our asset management partners to make sure that we understand the exposures that we've got and that we are comfortable with the exposures to gas point. If you think about the exposure that we do have, over 60% is to senior secured lending, and this remains the sort of underpin of what we're doing. Obviously, we're conscious of what's going on in the market. It's largely related to retail investors who perhaps didn't fully appreciate the nature of the investments. But I think, as Ian Seong has said as well, liquidity is a key focus for us, and we are not dependent on our private asset program for liquidity. Thank you.

On your question on China, yeah, China. We have a very robust operating model, a very differentiated premier agency channel, and a very selective and differentiated partnership distribution channel as well. We are very focused on serving the life and health insurance and long-term savings needs of middle class and affluent families. In mainland China, you know, many of our, you know, on average, the middle class affluent customers of our agencies, of our planning agents in China, on average, you know, have five products with AIA, AIA China. We are also in a very unique position whereby we are able to expand and do new geographies since 2019. We have entered nine new provinces, giving us access to 200 million additional middle-class and affluent customers. And we will continue to expand our footprint across China. So AIA China really is very much focused on the life and health insurance and long-term savings needs of middle-class and affluent customers.

Thank you. Thanks for the question, Michael.

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

Thanks. It's Michael here. I have maybe three questions. First one is directed at Yuanxiang. Sorry, I have three questions here. First one is directed at Yuanxiang. Yes, I'm just taking a look at the briefing thus far, the questions, and taking a look at AIA across time. Because talking to investors pre-pandemic, AIA, just looking at the BOMB growth, it seems to be at a different level from right now. And right now, looking at the outlook, there's a lot of uncertainties introduced by distortions caused by regulation in Hong Kong, in mainland China. Some of your peers have tried to reduce the uncertainty about the outlook with guidance on, say, new business CSM or VOMB. What do you think of the necessity of providing forward guidance on, say, key important metrics? So that's one. Secondly, I really appreciate the changing of the wording of the guidance of the operating EPS growth targets, 9 to 11% from 2023 to 2026. But having said that, if I go with that range, this only implies 3 to 9% operating EPS growth for 2026, which I would think should be easily exceeded, at least on my forecast. How should we think about the operating per share growth going forward? Because the CSM is clearly recovering. I think the metrics are clearly improving from the point of AIA. Maybe the last question. then relates to the capital front because that's been another area of focus. If I take a look at the required capital under the shareholder capital ratio, there's clearly a slowdown in the required capital growth. It's up 8% year-on-year in 2025. Last year it was up 13%. I think that's pretty much a shift to par. And if I hear what Darf and Yuan Jiang said just now about calibrating this against a severe stress situation. It's clearly that half products can absorb stress much better. I just want to understand, firstly, under what conditions would AIA consider changing that are prudent comfortably above 200% capital ratio level? And then on the leverage front, say if you're considering acquisitions, could there be change in the leverage as well, leverage ratio? Thanks a lot.

Thank you, Michael. On your question about forward guidance, I think you can see that in 2025 and even earlier years since COVID, we have delivered very strong performance and I believe sustainable performance in our key financial metrics including VONB, EV equity, OPAT and ROED and ROE are at record levels now, so... I think we operate in markets, as I said, with highly attractive growth opportunities for Asia. We are a pan-Asian diversified business. That gives us greater diversification. And in these markets, the majority of them, we actually have market-leading positions with very strong competitive advantages including our primary agency channel so I think the good record speaks for itself in terms of the ability to deliver strong consistent performance across our market cycles right now In terms of the OPEC per share target, I just remind you that first of all, we are actually quite well progressed to meet or exceed this OPEC per share growth target which was set for 2023 to 2026. As you may recall, this target was introduced during the transition from IFRS 4 to IFRS 17 and it was to help the market better understand the impact of the transition of the two accounting standards. which is actually pretty complex so that's which is why the main consideration at that time for us to give this OPEC per share target now by the end of 2026 you will have five years of historical data with which to more accurately model the IFRS 17 earnings trajectory and with the transparency of the IFRS 17 model, I think it is quite entirely doable. And on the capital question, I'll hand over to maybe Garth.

Yeah, thanks Michael. On the required capital, there are a number of things that drive the required capital. Clearly, product is one of those, and participating business, you have to remember that has to be added to the enforced business, so there's a slow progression as you change the mix of business. Required capital also depends obviously on things such as interest rates and our strategic asset allocation that goes behind that and any regulatory changes. We continually review that. We've reviewed it in the past and we look at our stress tests. That's where we came up with the comfortably above 200% level. We're very happy with that level at present and it's part of our overall capital framework.

Okay, thanks. Okay, great. Michael, did I cover your question?

Oh, leverage, sorry. I forgot to cover leverage, certainly. We're very comfortable with our leverage levels, Michael. We're very comfortable with our ratings. We clearly have some headroom within the ratings, but... We like where we are. We have strong financial flexibility and we feel that the current leverage level is appropriate. We added some more debt during the year, but obviously as the business grows, then the leverage ratio will move along. But we're very comfortable where we are. All right, I think that covers it.

Thanks a lot. Thank you. We have time for one final question.

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

Sure. Thank you for the opportunity for the last question. I've got two questions. One is back to Hong Kong. So we're seeing some obviously RMV appreciation in the beginning of the year. you know, is there any impact on the Hong Kong business temporarily? And also, obviously, you know, we heard there's some changes on the commission distribution to the agencies, whether that will impact the competitive landscape in Hong Kong or, you know, recruiting or some of these business growth in the near term, I guess, you know, medium term as well. And secondly, on China, We see healthy outlook in the first couple months. Can we get a little bit more sort of like the volume versus margins and product mix on that front? And also on China, a lot of domestic life insurance are still heavily investing in health services, et cetera. Are we expending any services or product on that front as well? Thank you.

Thank you, Richard. On your question on Hong Kong and the demand, as I said at the beginning, in terms of the outlook for demand, both from the domestic and the overseas segment, and the overseas segment actually MCVs, the vast majority the outlook for demand from these two segments is very very strong and we are very confident of the that there will be sustained demand coming from these two segments so any short-term you know movements in like exchange rate actually does not affect this strong demand for Hong Kong insurance products. Maybe Jackie is closer to the market, he may like to elaborate further.

I just like to add that the MCV business to Hong Kong has been here for more than two decades and we went through different cycles of RMB appreciation depreciation. And in fact, the demand of MCV customer to the Hong Kong insurance product is largely from the attractive proposition available in Hong Kong and also the demand for the diversification of wealth management to Hong Kong. So we really don't see the RMB appreciation has any major impact to our business. And as to your question on... commission spending requirement. In fact, Air Hong Kong has been applying a kind of commission spending already because of encouragement of servicing of our agent to the existing customer and also align more in the long-term interest of the customer. We are already applying renewable kind of compensation. So the necessary change to our compensation actually is minimal and it doesn't affect any of our business momentum from the agency force.

And on the question on China, in terms of the VOMB in January and February, we do not disclose this information. But in terms of your question on the proposition development in the mainland China market, I hand over to Fisher to talk about.

Thanks for the question. Number one, I think we are focused on the protection of long-term saving. As I said, we provide a comprehensive suite of the product supported by ecosystem-based service. So maybe let me talk about the product first. As you know, AIE China is almost the you know, the very few, you know, insurance companies who are still very keen on the protection. So we have observed, even in the last year, we observed a double digit growth in the CI. We continue to innovate in the product. I give you some typical example. Number one is our Paa CI. It's very well received in the second half of last year because, you know, with Paa it can address upside potential. And the number two, we developed a module based medical. That one is also very well received by the marquee because we put the different key elements like VIP room, advanced drugs into each module. So the customer can base down their affordability to choose a different package. We call it the DIY medical. That is very well received by the marquee. And very importantly, I want to also let you know, in this year, the Shanghai government launched a pilot, allowed the personal account of the social medical insurance to buy the commercial insurance through the agent. We are the first one to be chosen, and now we already sold to more than 10,000 customers. That is very good. We continue to also innovate in long-term saving, like deferred annuity, immediate annuity, quite a lot of new innovation in the product side. And secondly, I want to talk about the ecosystem-based service. As you know, since eight years ago, we already started to build a solid, comprehensive ecosystem, including the hospital network, the healthcare ecosystem, and also the retirement-related ecosystem. tailor the service and you know take a retirement as an example in the you know strong capable period, less capable period, disabled period, terminal period so you know it's a very flexible tailor and we also provide a timely consideration service so that kind of a service has a strong enabler and empowerment to our strong proposition So we also continue to strengthen the different segments. Number one, I give you a typical example. We are the first company to go to the substandard segment. We developed the SIOCI, which is very well received by the customer. And I just mentioned the high-net-worth segment. We continue to innovate. Recently we launched, take the service example, we launched the private family hospital. And for the product, we collaborated with the trust, we launched the insurance trust 3.0. So in summary, I want to let you know, our high-level strategy is, again, comprehensive suit of product is number one. And number two, equipped by strong ecosystem-based service. And number three, please don't forget, that is our core advantage. professional advisor service by our premium agency and differentiate profitable bank transactions. I think that's a basic summary.

Alright, thanks for the questions Richard. I think that's what we've got time for today. If there are any follow-up questions or any further questions, please feel free to get in touch with us in Investor Relations.

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