Half Year 2024 Ageas SA Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: David Barma - Bank of America - Analyst : The first I have is on Chinese remittances. Are there any implications from Taiping moving to IFRS 17 better than we thought? Is the regulator now taking a more realistic view when considering payout ratios? That's my first question. And then secondly, on Europe. So you're targeting a below 95% on discounted combined ratio for the UK? What did you achieve in the first half? Thank you.

Question: David Barma - Bank of America - Analyst : Just a follow-up on the first one. So when thinking about the Chinese business sensitivity to lower interest rates there, should we mostly be thinking about the impact on solvency then -- when thinking about the impact with cash ultimately? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. AUGUST 28, 2024 / 7:00AM, AGES.BR - Half Year 2024 Ageas SA Earnings Call

Question: Farooq Hanif - JPMorgan - Analyst : Congratulations on your results. Just firstly, could you just give a little bit more detail around the CTIH policy on dividends and what you would expect Taiping to have to do to meet that? And maybe just a little bit more on the current solvency position and where that might move given what we know about the yield curve. It feels like Taiping, it feel that solvency is -- I just want to check what that would mean for cash upstream going forward. Second question is on the holding -- holdco cash result, which dropped a lot. So there's a central cost that dropped in the holdco. Is that sustainable? I think it was EUR76 million in the first half. Is that sustainable reduction? And maybe last question, just on what you're seeing in terms of outlook for stability in the UK business and those Motor pricing is probably now reducing a little bit but it feels like it is still improving. So if you could comment on what you see in sustainability, I guess, of combined ratio in Europe in light of this. Thank you very much.

Question: Michael Huttner - Berenberg - Analyst : Thank you so much. I'm afraid I'm going to ask again on China because I don't think, I don't have the impression that you answer the questions and I'm really sorry to say that normally. So if I remember from previous -- you actually gave the solvency number for China in the past from memory, it was dipping to 270 or 260 or something. So I just wondered if you can give an update on that and the drag on that number which forecast how much it could go down. And also on the cash from China -- I hadn't my model previously, the cash figures from Malaysia, Thailand, and China. And I can't find them in environment. I just wondered maybe -- maybe it's interesting, Filip, but apologies for that. The second is congratulations on your fantastic growth. And here, the two questions linked to that. The first one is strategic. Does it mean that you're happy with the business model as it is, you don't need another strategic fourth leg or whatever? And the second is, the operating profit, it's actually going to be the same second half or first half as I judge by your numbers. So when will that growth come through into the operating profit? Thank you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. AUGUST 28, 2024 / 7:00AM, AGES.BR - Half Year 2024 Ageas SA Earnings Call

Question: Anthony Yang - Goldman Sachs - Analyst : The first question is coming back to China. I think there is a new regulatory pricing going on or will happen in China. Can you guide when that will happen and how Taiping Life is prepared for that? And second question, is coming to the non-Life, should we regard the combined ratio in Europe and Belgium as a normalized level going forward? Thank you.

Question: Anthony Yang - Goldman Sachs - Analyst : Thank you. If I may just follow up on the first question which is which really, really helpful on the comments. I think theoretically, say, if we see a higher value of new business going forward, given all these measures to improve economic value. But at the same time, say, if the China government bond yield still decline, theoretically, how would that impact the IFRS earnings, would that still -- will that increase given the release from the CSM new business? Or would that decrease given the lower yield? Thank you.

Question: Nasib Ahmed - UBS - Analyst : First one on IFRS Solvency II reform, what's the expected impact on the Solvency II entities from that reform? And then secondly, on the holdco cash position, very strong but the interim dividend and the share buyback is coming off it. I know you don't typically give a range of whether you're comfortable; but typically, companies are looking at one year's dividend holding company costs. Is that the way we should look at your holding company cash range where you'll be comfortable with that position? Thank you.

Question: Steven Haywood - HSBC - Analyst : Two questions from me. The first one is on the non-Life businesses, in particular, Portugal, where we have the change in trends in the past, maybe it was on the Health side of things here. I was just wondering if you have any update or any new trends that are coming out of here and how the pricing is developing versus any concerns that you're having in Portugal? And also how the change of tax on the Taiping Re side of things, that seems to have improved. Can you give us a bit of information about the trends you're seeing on Taiping Re. And then secondly, obviously, you've announced a very impressive share buyback today. But can you remind us what the group policy is on excess capital and shareholder remuneration? I know you've got an Investor Day coming up very soon but if you can discuss what your thought processes are around capital management and returning further excess capital to shareholders in the medium term? Thank you.

Question: David Barma - Bank of America - Analyst : I just have a few small follow-ups. Firstly, on the combined ratio of Europe and sorry, if I'm a bit slow on this but the -- you're targeting below 95 discounted for the UK You were at 98 for the whole of Europe, you're saying Portugal has fixed the issues in Health and Portugal used to do high 80s or 90s. I understand there's a drag from Turkey, but this would suggest the UK is still at very high levels. Could you give us a bit of color and the number would be great to the UK given you have a target for that? And then secondly, on Belgium non-Life, the prior year releases were a bit lower than your normal run rate. Is there anything special in there? And then lastly, on Asia on the investment results which was very strong even adjusting for the capital gains. Do you think that's a recurring level? Thank you.

Question: David Barma - Bank of America - Analyst : The discounted --

Question: David Barma - Bank of America - Analyst : This year, did you have below 90% or 95% undiscounted for this year. Is that still relevant?

Question: Michael Huttner - Berenberg - Analyst : And thanks for being so clear on the answers. On the tax in China, could you give a figure -- and I'm not sure whether the figure I should ask for is the full year or the half year. I don't know which is the most relevant. And the second is on real estate. Can you give us an update of what's happening in the market in Belgium? Thank you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. AUGUST 28, 2024 / 7:00AM, AGES.BR - Half Year 2024 Ageas SA Earnings Call

Question: Michael Huttner - Berenberg - Analyst : And that's just in the first half? Or is there more to come in the second half?

Question: Michael Huttner - Berenberg - Analyst : Thank you. On real estate?

Question: Michele Ballatore - KBW - Analyst : Yeah. Thank you. I have just one question about the -- going back to the operational capital consumption in the first half of 2024 versus last year. I mean, obviously a material improvement -- I mean, how much of this improvement, let's say, is nonrecurring? And how should we look at this factor going forward, second half but also in the next years? Can you guide us in terms of also thinking about this factor modelling it? Thank you.

Question: Michele Ballatore - KBW - Analyst : So the effect of these asset management actions will be -- I mean, will continue.

Question: Jason Kalamboussis - ING - Analyst : First thing, just a follow-up question on what you just discussed. So could you -- if you cannot give an outlook, can you at least give us a split or how much is the element that was driven to the asset management changes in the first half, so that at least we know which is a more normalized level for -- excluding this? And if you can also tell us if it's something that we think will continue in the second half. The second thing is coming back to the UK I mean you have merged essentially the UK to Europe and you don't disclose it separately but then you try to do a mega deal in the UK which means that we'll go back to separate disclosure. So here, it's less of a question but it would be great to consider, again, showing more disclosure of the UK essentially because you want to do possibly a bigger deal there and it's important for us to have the granularity and to see the progress you are making more specifically. And so my second question is on Asia. Thank you for walking us through all the regulatory changes that are being considered. Could you tell us when this will actually happen on the solvency side because -- when do you think that there is going to be an outcome because that essentially will crystallize that side and essentially, if I understand it well, that should also free up CTIH to possibly increase its payout.