Incoming AXA boss to accelerate cuts and target acquisitions

The incoming AXA CEO Thomas Buberl plans to accelerate cost cutting at the French insurer and target growth markets via acquisitions to reach new 2020 corporate targets.

As part of the French insurer’s 2020 strategy, AXA wants to achieve an average annual increase in underlying earnings per share of between 3 percent and 7 between 2015 and 2020.

“This is extremely ambitious in an environment that is not favorable to us,” Buberl said during a June 21 press conference, pointing to the low interest rate and low growth environment.

To achieve its goal, AXA is, for example, looking to grow in the property/casualty insurance segment for corporations.

“We were quite successful in the UK in this area and we are currently copying this model to apply it to the European continent,” Buberl said.

AXA also aims to grow its life insurance business in Asia, where it built a platform with portfolios and partnerships. In addition, AXA sees scope to grow its healthcare business.

In order to support its profit target, AXA wants to spend around €1 billion annually over the period on acquisitions, particularly in higher growth rate markets and less so in mature markets, group chief financial officer Gérald Harlin explained.

In addition, AXA plans to cut costs by €2.1 billion over the five years ending 2020. In the previous five-year period ending 2015 AXA overachieved on its target of €1.5 billion cost savings with €1.9 billion among others through lower administrative costs and claims management expenses.

Thomas Buberl is set to take over as CEO of AXA on September 1, 2016.