Q: AIAs solvency ratio has gone up to 356%, something most banks we speak to could never dream of. That amounts to some $5 billion in cash reserves. What are you going to do with it? A: We think of it as being in four blocks, of which the first is the most important. Thats investing in new business profitability. We have significant cash to invest in growing new business we can grow at 20% IRRs plus. Secondly, theres a capital buffer that from a statutory and regulatory point of view we need to have in place. Weve got to be able to withstand a one-in-ten or one-in-twenty-year event. Thirdly, we want some flexibility to do small-scale bolt on M&A if thats available. And last but not least you pay a dividend. [AIA announced to day an interim dividend of 11 Hong Kong cents per share, the first dividend since listing]. Q: Under what circumstances would it ever make sense for you to acquire outside of the region? A: We have an incredible opportunity in Asia, and for the time being thats where we need to grow organically and to focus. Q: What are your concerns in the medium term? A: Im an optimist and a believer in the fundamental drivers in Asia, when youve got GDP growing at the levels it is, the demographics, fiscal surpluses, foreign exchange surpluses, leverage less than it is in the US or Europe, emerging middle classes, the move from public to private sector...everythings moving in the right direction. Ive been positive on Asia for 30 years. Q: But there are concerns in each market, whether its rising debt levels in China, inflation in Vietnam, political difficulties... A: Yes but youve got to put things in context. Ive been out here 25 years. If you look at Vietnam 24 years ago, when I first went there, compared to today, the transformation has been phenomenal. The same is true for China. The change is dramatic in any historical sense. Q: Korea has been a tough market for AIA. Whats your plan to turn performance there around? A: I think it has turned around materially with this set of results, youve seen margin increase, sales increase, value of new business increase which are the three main metrics. Gordon [Watson, regional managing director] and Dan Costello [CEO Korea] have done a terrific job in beginning to turn it around. Q: Why was that a tough market for AIA? A: Some of it was AIG related. AIG Korea wasnt controlled by AIA: it was run by AIG Japan, and only came in to the AIA portfolio in the last couple of years. A lot of Japanese products were copied and used which werent as applicable in Korea as first thought, and significant economic loss was therefore suffered. Another significant factor, and youll appreciate this, was the AIG sponsorship of Manchester United. [Korean midfielder] Park Ji-Sung was man of the year in Korea for two years and it was in front of everybody. So when the business changed name we had to build the AIA name from scratch. So the team has done a fantastic job. Q: By which you mean your team, not Manchester United? A: My team [Tucker is an avid Chelsea supporter]... well, well see. Q: Its interesting in Asia that China and India are the two biggest, fastest growing markets but also two of the hardest to do business in. Whats your plan for each of those markets? A: In China, we have a very strong business, its grown significantly this year, and the regulators have been excellent incredibly supportive and understanding. In India its been much more challenging. The regulator has moved to be a micro-supervisor at a detailed level and thats meant returns have not been as attractive as other countries, and thats limited a number of people investing there. India has all the right characteristics: it could be the fastest growing economy in Asia over the next 20 years but the basis of the insurance industry is a bit behind the curve. Its a market were committed to: any economy growing at 7, 8, 9% is one we need to be in. Q: You spoke in todays press conference about your confidence in your holdings of US corporate debt. Could elaborate on why that is given the news out of that country is so grim lately? A: I think you have to separate the macro news and the micro news. The macro has been challenging as you say, but the micro news in terms of earnings coming through has been pretty strong. We fundamentally invest for the long term and we hold the assets we buy to maturity, so if you believe in the US as we do, in the future of that economy, then that short-term volatility is not a concern.