Good morning, everyone. I'm very excited to be here today to present FWD's first half year results as a public company. We are delighted to have successfully listed on the main board of the Hong Kong Stock Exchange and also to have welcomed many new shareholders to the FWD family. I will start with providing you an overview of our business achievements before handing over to Sid, our Group CFO, who will take you through the key financial highlights. FWD is one of the leading pan-Asian insurers with strong market positions in most of our 10 markets. After launching in 2013, we have grown significantly with 97% of our growth over the last three and a half years being organic.
With our unique geographic footprint, diversified distribution channels, and the right set of products, technologies, and digital tools that meet our customer needs, and backed by a management team that has a strong track record in the insurance industry, we remain confident that we will continue to grow faster than the industry in the coming years. Today, we are pleased to announce the delivery of a record set of interim results across key metrics, the continuation of our growth story, and of creating value for our shareholders. In terms of new business sales and new business contractual service margin, or NB CSM, our growth for the first half of 2025 exceeded that of 2023-2024, highlighting our growth focus.
Our new business sales growth was up 38% approximately to $1.25 billion, and new business CSM grew by 34% to $794 million. As our group is maturing, we have become more profitable with our operating profit after tax, or OPAT, growing by 9% to $251 million. We delivered a record net profit after tax under IFRS 17 of $47 million. We are also particularly pleased with our expense discipline, which resulted in an underrun in the first half of 2025. We improved our value creation with half-year comprehensive tangible equity and embedded value both increased by 8%. Last but not least, we are thrilled about our successful IPO, which brought in many new shareholders and enhanced our financial flexibility through raising $466 million in gross proceeds.
The successful IPO also contributed to an upgrade to our financial strength rating by Moody's to A2. Our customers are always at the heart of our business strategies, and this has helped us grow over the past decade. In terms of distribution, we believe in a tailored strategy adapted to each of our geographic markets rather than a one-size-fits-all approach. We are one of the leading bancassurers in Southeast Asia, and we are very proud of the high quality partnerships we have established with the local champion banks across the region. We have a high quality agency force which consistently ranked in the top ten when it comes to Million Dollar Round Table global ranking. We also believe that the brokerage and IFA channel with strong pricing discipline is a key channel for growth, especially in wealth management hubs like Singapore and Hong Kong.
When it comes to technology, today every insurance company must be a technology company to a large extent. We have embraced and invested in technology since our inception 12 years ago, and we believe that this gives us a unique competitive advantage. Due to our legacy-light nature, our technology infrastructure is modern and provides us with the ability to access our data across our businesses. This allows us to develop GenAI empowered tools to improve the productivities of our agents and of our banker partners, as well as providing better customer service to our customers. As a result, we've won numerous awards for our digitalization and providing best-in-class service to our customers. Innovation is at the heart of FWD, and one important way we achieve that is through our continuing effort to create new and innovative product propositions to serve our customer needs.
In 2025, we expand our customer propositions and examples include the successful build-out of our high net worth hub, FWD Private, the launch of a new yen savings product in Japan, and the launch of the Index Universal Life plan in Hong Kong, first in the market to offer uncapped crediting interest rate and guaranteed stable returns. We aim to put the customers at the center of everything we do, and we are proud that our claims Net Promoter Scores were +63 in the first half of 2025, highlighting sustained satisfaction on how we take care of our customers. Our digital innovation also is a key driver in making the insurance customer's journey faster, simpler and smoother. In the first half of 2025, 92% of our customers rated us good or great after completing their purchasing and onboarding process.
FWD continues to build upon our strong leadership position across our diversified pan-Asian geographic footprint. In Hong Kong, FWD benefits from the incoming mainland Chinese visitors, from the city's growing role as a global wealth management hub and the continued Greater Bay Area development. Hong Kong and Macau business segment contributes up to around half of our new business sales in first half of 2025. We continue to focus on our multi-channel distribution strategy alongside with product innovation, such as our new cross-border Greater Bay Area medical services and our launch of the Index Universal Life offering that I mentioned just now. Earlier this year, we further expand our high-net-worth hubs in Asia, operating out of three jurisdictions: Hong Kong SAR, Singapore and Bermuda. This business aims to serve the fast-growing global high-end insurance market with diversified asset allocation, wealth management and legacy planning.
As a result, our Hong Kong new business sales have almost doubled and new business CSM has more than doubled for the first half of 2025, improving our share in this important market. Thailand and Cambodia is a key market for us and is our second largest in terms of top line metrics. We are the second largest life insurers by new business sales. This segment has historically contributed substantially to FWD's growth, and it's remitted record dividends to the group during the first half of 2025, while increasing OPAT by 17%. In Thailand, a large part of our new business comes from our exclusive partnership with SCB Bank, making us number one bancassurance in this market. We are also building a high quality agency channel, and we are pleased to retain the number two positions for Million Dollar Round Table ranking in 2025.
Thailand and Cambodia new business indicators for the first half of 2025 were partly impacted by our exit from the corporate care segment in 2024 and the re-underwriting of our health product portfolio earlier this year. The business, however, remains well-positioned to meet the demand for protection, medical and pension products upon an aging and affluent population. Japan contributes roughly a quarter of our OPAT and is a key cash contributor to the group due to its relatively mature profile. The business reported solid new business results for first half of 2025. In Japan, our protection products market leadership is well established and our strategy is to diversify our product mix.
With the introduction of its first savings offering in July, a JPY single premium annuity product, we now entered into the savings and retirement market, and we aim to gain market share given the aging population and higher interest rate environment in Japan. As the core of our growth engine of Southeast Asia, emerging market is a key segment for the long term growth ambition at FWD. Despite industry headwinds and economic uncertainty in several markets, we achieved strong new business sales growth in the first half of 2025. In Indonesia, BRI Life, our life insurance joint venture with Bank BRI, was number one in bancassurance in the market. In the Philippines, we rank number two overall. Also in the Philippines, FWD agent and advisor ranked number two in the latest annual MDRT ranking.
Across emerging markets, our relentless focus on digital enablement has been paying dividends and will certainly help us unlock the next stage of growth. We strategically built our diversification not just across our pan-Asian geographic footprint, but also in terms of distribution channels. While the cornerstone of our distribution strategy is bancassurance through our high quality partnerships, we also have strong capabilities across other channels that allow us to nimbly capture new business opportunities when they occur. A great example of this is the performance of the broker IFA channel in Hong Kong and Macau segment this year. Our bancassurance channel contributes 43% to the group VNB, mainly in the markets of Thailand and Cambodia, Hong Kong and Macau, Indonesia, Philippines and Vietnam.
This is followed by the broker IFA channels that contributes 38% to the group VNB, mainly from Hong Kong and Macau, Japan and Singapore. Our agency channels contribute 14% to the group VNB. However, given our established footprint, we are well positioned to further expand this channel in the medium term. The digital and ecosystem partner channel is relatively small for the time being, with contribution of 6% to the group VNB. Fueled by our FWD Private brand build- out, in addition to the strong network of over 2,800 brokers and IFA partners, our broker and IFA channel grew by 97% in terms of APE. Performance is particularly strong in Hong Kong and Macau. At the first half of 2025, VNB contribution from broker and IFA channels were 38%.
Going forward, we continue to expect strong momentum in the broker IFA channel in markets like Hong Kong and Singapore for FWD. Our bancassurance channels continued to grow robustly off the back of our market-leading partnerships network. This growth was mainly attributable to significant growth in Hong Kong and the Philippines, partially offset by the stable growth in Thailand. Overall, our bancassurance channel delivered 16% growth in APE for the first half of 2025. Agency channel recorded strong business growth of 20% year-on-year in the first half. For VNB, the channel grew even stronger at 36% year-on-year. This growth was delivered by a 50% improvement in productivity. This focus on quality also results in our consistent top ten MDRT position achieved.
Agency remain to be an important part of our long-term sustainable growth strategy, and we will continue to focus on building a strong, sustainable, and profitable channel to complement our further growth and diversification. Since the first day of the setting up of FWD Group, we have focused on building best-in-class digital capability and technology to better serve our customer and to enable our distribution partners. Much of what we have talked to you about before are built on these foundational elements. First and foremost, we leverage our data infrastructure for important decision making. From customer prospecting to claims management. We have in place data mesh technology, allowing us to access our data in real time with a single source of truth across all markets. Secondly, we house everything we do on a 21st-c entury technology platform. We are virtually completely cloud native at this point.
This allow us to incorporate new technology quickly and to integrate our systems with our distribution partners seamlessly. Finally, this foundation allows for much faster deployment of GenAI and other analytical tools, not just for isolated use cases, but truly across many business processes in our organization. This allow us to deliver tangible benefits in term of customer engagement, in term of improvement in productivity of our distribution network, and translate into operational efficiency. For example, we have launched tools to attract customers and enable them to quickly access policies and claims on their phone in seven markets. We have implement digital and AI tools for our distributors in 10 markets to improve their productivity. We also are using AI powered tools to improve our operational efficiency, particularly in underwriting and claim processing. Our innovative agentic AI tools in Japan has improved our underwriting efficiency by 40%.
Before we wrap up our presentation today, there's a few things I hope you remember about FWD. We operate in the most attractive growth markets in Asia with a tailored distribution strategy in each market. We leverage our diversified distribution channels to offer customized propositions to our customers and effectively penetrate the markets. We are nimble and innovative in term of our application of technology. This provides us with a distinct competitive advantage. For the past few years, we have focused strongly on financial discipline, making our top-line growth increasingly flow through to the bottom line. Although we are much younger insurers than our peers, our solid capital positions is already bearing fruit with strong cash flow generation and remittances from operating units. Last but not least, being nimble, fast-moving is in our DNA.
We have an experienced management team with strong track record of leading successful insurance company around the world. Having the right leadership team is the most critical success factor for FWD to continue delivering outstanding and record-breaking growth. Thank you once again for your time and attendance today.
I'm thrilled to present the financial highlights for the first half of 2025 at this inaugural results presentation. These results are really a testament to the maturity of the business as we've delivered fantastic results across all metrics, balancing our exceptional growth and increased profitability with disciplined risk management so as to create value for our shareholders. Growth. As Phong mentioned, all key new business metrics in the first half of 2025 delivered record results with our new business sales growth up 38% to approximately $1.25 billion. New business CSM up 34% to $794 million, and VNB grew by 21% to $506 million.
The comparability of new business CSM and VNB growth were impacted by certain notable items, such as the decline in interest rates in Thailand, operating assumption changes in 2024, and statutory tax changes. If we were to adjust for these items, new business CSM grew 41% and VNB grew 33%. Reported VNB margin was 40.6%. If we were to adjust for these items, margins would be comparable to the full year 2024 margin of 43.5%. For the full year 2025, VNB margins are expected to be marginally below that of the first half, as we expect the downward trend of interest rates in Thailand to persist. Profitability. Strong new business sales have transformed into growing operating profit, which was up 9% to $251 million, supported by predictable and strong CSM release.
We've also delivered a record net profit under IFRS 17 of $47 million, which is a result of our ongoing focus on expense discipline. Our focus on expense discipline has also led to an expense underrun for the first half of 2025. Value creation. Ultimately, FWD is relentlessly working towards creating value for shareholders. With the first half of 2025 delivering strong value creation. Return on tangible equity was 17%. The CSM balance grew by 11%, while comprehensive tangible equity ( CTE), and embedded value ( EV), grew by 8%. The growth in CSM, CTE, and EV are the leading indicators of future growth and profitability and cash flow. The first half 2025 performance gives me tremendous confidence in the group's ability to deliver further earnings and cash flow growth in the future.
Cash and capital. Supported by strong earnings growth, net underlying free surplus growth ( UFSG) of 115%, and a robust balance sheet with stable solvency ratios resulted in cash remittances amounting to $541 million, which is similar to the full year figure for 2024. I would now like to walk you through some of our business financial highlights, starting with our largest market, Hong Kong and Macau. Hong Kong and Macau achieved outstanding results for the first half of 2025, with new business sales more than doubling to $640 million, reflecting ongoing broad-based demand from both local and mainland Chinese visitor customers. Our high net worth business, FWD Private, also contributed approximately 15% of the increase in new business sales.
Our diversified distribution strategy was a key driver behind new business sales growth, as we've been able to capitalize on the opportunity to sell Par products through the broker channel without compromising margins. This has resulted in increased market share and improved profitability through better operating leverage. For the second half of the year, we expect some degree of normalization of top line growth as we do not expect the current trend line to persist. Compared to top line growth, new business CSM growth was even stronger at 157% for the first half of 2025 to $400 million, while VNB grew by 91%, with the key difference in the growth rates being the impact of the expense underrun position on new business CSM.
Operating profit after tax ( OPAT), in this segment grew 28% year-on-year to $125 million as a result of higher CSM release due to stronger new business sales. In Thailand and Cambodia, new business sales at first half of 2025 were down 5% year-on-year to $311 million, partly due to the exit from underwriting corporate care business in 2024 and the re-underwriting of our health product portfolio. New business sales for the full year of 2025 are expected to be broadly flat against the prior year. In the medium to longer term, we remain confident in returning to growth in the Thai market given our market positioning, distribution network, and product suite. VNB and new business CSM margins in the first half of 2025 were impacted by lower interest rates.
When adjusting for this, margins were largely stable compared to the first half of last year. The continuing declining trend in interest rates will further impact reported margins in the second half of 2025. OPAT in the segment grew by 17% year-on-year to $81 million, supported by growing CSM amortization and improvement in operating variances and assumption changes. In Japan, our new business sales grew by 2% in the first half of 2025, with a flat first quarter and 4% growth in the second quarter. This growth was driven primarily by new business sales of newly launched medical products. New business sales of our protection business for the second half of 2025 are expected to be broadly in line with that of the first half.
New business sales from the new savings product launch in July would be incremental to this, and we're very excited about the growth potential in the Japan savings space. New business CSM grew 7%, whereas VNB declined by 12% in the first half of 2025 from operating assumption changes made at the year-end 2024. Adjusting for this, VNB and new business CSM margin are broadly in line with the prior year. OPAT in Japan declined by 13% year-on-year to $93 million, which is mainly attributable to one-off claim related factors and a higher statutory tax rate. Turning to emerging markets, as the core growth engine of Southeast Asia, we've continued to deliver strong new business sales growth of 18% for first half of 2025.
New business sales in our emerging markets segment is a good example of the benefits of diversification, as a slowdown in Vietnam new business sales was offset by stronger growth in Singapore and our Indonesian joint venture, BRI Life. In terms of outlook, the new business growth rate for the full year versus prior year is expected to be broadly in line with that in the first half. Despite strong growth in new business sales, there was a drop in new business CSM of 18% and VNB of 9% year-over-year as a result of operating assumption changes at year-end 2024 and statutory tax rates. Excluding these impacts, new business CSM was broadly flat, whereas VNB increased by 17% from the prior year.
When adjusting for these tax and assumption changes, VNB margins were flat to the prior year, whereas new business CSM margins declined by 10% due to channel mix in Singapore. OPAT grew 191% to $38 million at first half of 2025, with growth and profitability across all markets. OPAT for the first half of 2025 experienced solid growth and increased by 9% to $251 million, with all four segments being operating profit positive. Looking at the details, net insurance service result grew by 30% to $353 million at first half of 2025, which was due to a stronger CSM release and an improvement in operating variances and assumption changes.
Net investment results declined to $135 million in the first half of 2025 from $165 million a year ago. The decline was due to de-risking of the equities portfolio in 2024. Our operating expenses have remained broadly stable year-on-year as a result of disciplined expense management. Overall, OPAT growth was offset by statutory tax changes, higher withholding tax, as well as equity de-risking, excluding which our OPAT would have grown in the mid-teens. We expect OPAT in the second half of 2025 to be marginally lower than in the first half due to the dividend remittances from our operating segments in the first half of 2025, which lowers the investment return. With the growing CSM balance, we remain confident in our expectation of mid-teens growth rates and operating profit in coming years.
Moving to net profit, net profit grew from $3 million to a record $47 million under IFRS 17 in the first half of 2025. This improvement was driven by higher OPAT and ongoing expense discipline as non-market related costs declined materially in the first half of 2025 to $22 million, versus $91 million in the first half of 2024. CSM is one of the key indicators of value creation for shareholders at FWD, and we're pleased to report very strong growth of 11% in the CSM balance to approximately $6 billion at the first half of 2025. The operating contribution to CSM was more than $600 million due to a strong new business contribution and positive operating variances and assumption changes, which improved significantly from the prior year.
Non-operating factors contributed to the rest of the growth at around $200 million, and this largely affects related benefits coming from weaker USD against the THB and JPY . As we move forward, we note that the high 11% growth rate in the first half of 2025 will most likely normalize over the second half of this year. We remain confident that we are well positioned to grow CSM by mid-teens in the coming years. Turning to embedded value, EV grew 8% in the first half of 2025 to approximately $6.4 billion. EV operating profit grew by 77% year-on-year in the first half of 2025. Similar to CSM, persistency and claim variance have been positive for the full year 2024 and the first half of 2025, again highlighting our prudent operating assumptions.
We remain committed to ongoing expense discipline, which has also led to an expense underrun in the first half of 2025. We expect the underrun will persist in our three largest operating segments and will continue to trend down in our emerging markets segment as we increase scale. Similar to our CSM trajectory, the high growth rate in EV is expected to normalize in the second half. However, we're well positioned to continue to grow EV by mid-teens in the coming years. Ultimately, higher new business growth metrics, a strong earnings profile, and value-creating metrics all feed into free surplus generation and capital remittances that fund debt cost, holding company expenses, and create long-term capacity for potential dividend distributions.
Net UFSG in the first half of 2025 was $417 million, and increased by 115% from the same period in 2024. This is due to significant improvement in operating variances and assumption changes, and management actions such as expense overrun reduction and a reinsurance transaction. Going forward, we're confident that underlying business trends are robust and we're well-positioned to deliver growing free surplus generation. Cash remittances from our operating entities to the group treasury center were strong in the first half of 2025. Operating entities contributed $541 million for the period, compared with $589 million in 2024. We've completed our planned remittances for the year and do not expect to receive any further material remittances in the second half of 2025.
We've worked hard over the last few years to balance our strong growth by taking actions to improve capital efficiency, which resulted in our strong group solvency ratios on a prescribed capital ratio basis of 283% as of the first half 2025. This was a 23% improvement versus year-end 2024, mainly driven by lower interest rates in Thailand, favorable FX movements, as well as ongoing management actions and asset liability management and reinsurance. Looking ahead, our group solvency ratios will be impacted following adoption of the Japan Economic Solvency Regime or ESR. We're very supportive of the change in Japan to ESR as the economic principles underpinning it align well with our risk management approach in running the business.
With respect to impact on balance sheet and cash flows, our Japan business will file its first ESR submission based on March 2026 results, which would be published in the group solvency ratios for the first time at half year 2026. Broadly, we expect the following outcomes. First, a reduction of the local Japan's business solvency ratio from the current approximately 1,500% level. We expect our ESR ratio to be in the range of 150%-200% and expect it to be within a comparable range of multinational subsidiaries operating in Japan. Second, no material changes to the expected group level cash flows. Finally, no further constraint on the group's financial flexibility, given we manage the business under economic principles today.
We expect to provide you with further details in connection with this change when we present our year-end results early next year. With respect to our debt profile, our leverage ratio reduced by 1.8% from the year-end 2024 to 23.7% at the first half of 2025, mainly as a result of an increase in shareholders' equity. Our pro forma leverage ratio, including the IPO proceeds, was 23%. While there are no immediate refinancing needs with the next debt hard maturity being in 2028, prudent capital management actions will always be considered that could accelerate the attainment of our long-term target leverage ratio of 15%-20%. With that, let me hand over to Phong to wrap up before we go to Q&A.