Zurich Insurance explores Singapore and HK sale: Sources

HONG KONG/LONDON - Zurich Insurance is exploring a sale of its Hong Kong and Singapore operations as it reviews its non-core businesses outside Europe, sources familiar with the matter said.

The Swiss insurer has discussed the plan with several investment banks but has yet to hire advisers, the sources said, cautioning that no deal was certain.

A spokesman for Zurich, Europe's fifth-biggest insurer which is battling falling revenue in general insurance and sluggish growth at home, declined to comment on its plans.

The Swiss insurer launched an in-depth review of its business in September after explosions at the Chinese port of Tianjin caused losses of around US$275 million (S$386.83 million).

It had also abandoned a 5.6 billion pound (S$11 billion) bid for Britain's RSA Insurance after a "deterioration" in its general insurance business.

Then in January it issued a profit warning for its general insurance business and subsequently hired Generali's former Chief Mario Greco to revive its fortunes.

The firm's Asian review comes amid efforts to sell Zurich's businesses in South Africa and Morocco, the sources said, adding that Morgan Stanley is leading the South African sale, which Zurich announced on Feb 19.

Zurich began scaling back its Asian franchise last year when it stopped accepting new life policy applications in Singapore, where it has been since 2006.

Companies that have cut down their workforce in 2016

  • Tripda

    Rocket Internet's carpooling app, Tripda announced earlier this month that they would be organising a global shutdown of the platform.

  • Autodesk

    Autodesk a design-focused software announced early month that they will be laying off 925 positions, around 10 per cent of their entire workforce.

  • Yahoo

    Recently tech giant Yahoo confirmed that would be shedding 15 per cent of their entire workforce, and its also exploring other "strategic alternatives".

  • Yahoo

    Employees in Yahoo's Singapore office were notified of the layoffs on Feb 18.

  • Rakuten

    e-commerce platform Rakuten announced in Feb 2016 that they would be shutting down all their operations in Malaysia, Singapore and Indonesia.

  • Rakuten

    The platform probably faced a significant number of challenges in Malaysia, and they will be withdrawing to focus their efforts in countries like Japan and Taiwan.

  • Bombardier

    Bombardier will be cutting their workforce by about 7000 over the next two years.

  • Bombardier

    They will be cutting 580 jobs from their Belfast operation this year and potentially another 500 the following year.

  • Shell

    Multinational oil and gas company, Royal Dutch Shell operates in more than 70 countries and employ more than 94,000 people worldwide.

  • Shell

    Given the fact that oil prices have dropped by almost 70 per cent in less than two years, the company has already started cutting 10,000 jobs to try and recover from all their losses.

  • Devon Energy

    Devon Energy, a US oil producer, mentioned that 700 people would lose their jobs by the end of the Feb 18, 2016, and this is all in response to the current commodity price environment.

  • Top Glove

    Malaysian company Top Glove is currently the world's largest maker of natural rubber gloves with operations in 27 countries. The company announced that they would cut their foreign labour by 5 per cent due to rising costs and increasing automation.

  • Barclays

    Some 100 Barclays employees in Singapore were axed on Jan 21 in a drastic cost-cutting exercise which saw the bank exit multiple businesses across Asia.

  • Standard Chartered

    Global bank Standard Chartered had laid off a number of people in Singapore late last year as it axed 15,000 jobs globally.

  • Standard Chartered

    Its previous workforce globally was at 86,000, and currently employs about 7,000 staff in Singapore.

  • HSBC

    HSBC has announced that they will be freezing salaries and freezing hiring in 2016 globally in the battle to cut costs, affecting 3,000 Singapore employees.

  • Resorts World Sentosa

    According to a report on Straits Times, more than 30 employees at Resorts World Sentosa (RWS) have been laid off earlier in February.

  • Resorts World Sentosa

    However, the lay offs was due to overstaffing and it is not an isolated case. There are currently about 12,000 people working at Resorts World Sentosa.

  • Maersk

    Maersk Line, one of the world's top container shipping companies, recently merged its Singapore and Hong Kong regional offices. Last November, it also shared new plans to reduce its network capacity and announced that it will be cutting 4,000 jobs.

  • STMicroelectronics

    STMicroelectronics will cut about 1,400 jobs and close its loss-making set-top box business, including 670 in Asia.

  • Goldman Sachs

    Goldman Sachs has been reducing the size of its investment-banking team in Singapore by about 30 per cent compared with the start of last year, according to a report from Bloomberg.

  • Credit Suisse

    Credit Suisse announced 4,000 job cuts globally, although no layoffs are expected in the Asia-Pacific region yet.

  • Royal Bank of Scotland

    Royal Bank of Scotland has also announced that they could be cutting as many as 80 per cent of the jobs in its investment banking unit over the next 4 years, and last year laid off "hundreds" in Singapore.

ASIAN FRANCHISE

A partial exit from Asia will need the blessing of Zurich's incoming boss Greco.

The 56-year-old executive will take over the reins in March from Tom de Swaan, who has held the role on an interim basis since Martin Senn stepped down in December. "It's up to Greco to take the final decision on Asia," one of the sources said.

If a sale goes ahead, Zurich will focus on China, Indonesia, Japan, Malaysia, Australia, New Zealand and Taiwan, the sources said.

Zurich restructured its Australia business last year, pulling out of some products, changing its organisational structure and cutting jobs.

SERVICES