Hyundai Life completes W300 bil. capital increase to become Fubon Hyundai

By Jhoo Dong-chan

Hyundai Life changed its name to Fubon Hyundai Life Insurance during an extraordinary shareholders meeting Thursday, the insurer said Friday. The new name will be used starting today.

It has been six years since Hyundai Mobis, auto parts maker subsidiary of the nation's largest carmaker, acquired the then Green Cross Life Insurance in 2012. The insurer is Korea's second financial firm taken over by Taiwanese capital following Yuanta Securities' acquisition of Tongyang Securities.

Along with the renaming, the insurer has also completed 300 billion won ($268.2 million) worth of capital increase. Through the capital increase, Hyundai Life has become a subsidiary of Fubon Life as the Taiwanese firm decided to raise its stake by participating in the Korean insurer's capital increase.

"Fubon Group's overseas subsidiaries show successful earnings in the Asian market," Fubon Group Chairman Richard Tsai said.

"Fubon Hyundai Life will also become one of the top financial firms in Northeastern Asia."

Hyundai Mobis, previously with a 30.28 percent stake, decided not to join the capital increase while another of the carmaker group's subsidiaries Hyundai Commercial raised capital worth 60.3 billion won.

Carrying out 233.6 billion won worth of capital increase, Fubon Life has become the insurer's largest shareholder with a 62 percent stake while Hyundai Motor Group's subsidiaries jointly hold 37 percent _ Hyundai Commercial with a 20 percent stake and Mobis with 17 percent.

"Fubon Hyundai Life will focus on retirement pension and telemarketing sectors," Fubon Hyundai Life CEO Lee Jae-won said.

"The firm will benchmark the Fubon Group's knowhow in bancassurance to reenter the nation's market."

Hyundai Life's risk-based capital ratio (RBC) was only 157.8 percent in January, close to the government's minimum recommendation of 150 percent. The RBS requirement refers to a rule that establishes minimum regulatory capital for financial institutions, and the insurer's RBC ratio is expected to reach nearly 250 percent by the end of this year thanks to the capital increase.

The capital increase by major shareholders is aimed at preparing for new global financial standards, such as IFRS17, which is to be implemented in 2021. The new accounting rule will evaluate liabilities based on market value.


Jhoo Dong-chan jhoo@koreatimes.co.kr

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