Continuing its expansion into Asia, MetLife (NYSE:MET) has signed an agreement with Bank for Investment & Development of Vietnam (BIDV) and Bank for Investment and Development of Vietnam Insurance Corporation (BIC) to establish a joint venture in Vietnam offering life and health insurance products.  MetLife will own 60% of the JV, which will have a charter capital of VND 1 trillion.
In the wake of the financial crisis of 2008, which led to a slowdown in the U.S., MetLife has turned to Asian markets for growth. The company’s premiums from the U.S. decreased from $17.17 billion in 2008 to $16 billion in 2012. In contrast, premiums from international operations increased from $2.88 billion in 2008 to $13.29 billion in 2012. Much of this growth came from the 2010 acquisition of ALICO from AIG (NYSE:AIG), which helped MetLife establish a foothold in Asia. Asian markets now account for more than 60% of the company’s international premiums.
Our $51 price estimate for MetLife’s stock is at a premium of 10% to the current market price.
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The Vietnamese Market
Vietnam is the 15th biggest insurance market in Asia with life insurance premium volume of around $900 million. Premiums grew 13% in 2012 and 11% in 2011.  Insurance penetration (premiums as a percentage of GDP) is extremely low at around 0.6%. In contrast, Japan has a penetration of nearly 10%. Premiums as a percentage of GDP are 8% in South Korea and around 2% to 3% in India and China. 
We believe that the Vietnamese insurance market is poised to expand in the coming years with MetLife in a prime position to capitalize. We currently expect MetLife’s Asian premiums to expand from $8 billion in 2012 to nearly $15 billion by the end of the decade. Much of this growth will come from emerging markets like India, China and Vietnam. For more, please read MetLife’s Asian Potential Part 1: Japan and MetLife’s Asian Potential Part 2: India And China.Notes: