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A Chinese flag flies near apartment buildings in Beijing on September 11, 2015.GREG BAKER/AFP / Getty Images

Economic woes in China aren't stopping Manulife Financial Corp. from pushing ahead with its Asian expansion plan.

The insurance giant, which is headquartered in Toronto but earns most of its money abroad, is looking to grow its wealth management business in Asia. The company's most recent acquisition asserts its view that long-term business opportunities won't be influenced by a dip in the Chinese economy.

On Thursday, Manulife said it would buy Standard Chartered PLC's Hong Kong pension business, while the companies also struck a distribution agreement. As of June, this business managed about $2.4-billion (U.S.) in assets, most of which come from Mandatory Provident Fund (MPF) products – retirement-savings products implemented 15 years ago by the government in Hong Kong as a way to address an aging population with a low savings rate.

"Manulife actually kind of surprised people by becoming a very significant player in the market," said Steve Roder, chief financial officer at Manulife, at the Scotiabank Financials Summit this week. "It did that through training and incentivizing its agents to sell this product to small– and medium-size enterprises, primarily."

Mr. Roder compares MPF to the 401(k) in the U.S. – workplace plans used by employees to save for retirement, usually topped up by employers. Manulife now holds a quarter of the MPF market share and is the second-largest of about 20 providers by assets after HSBC.

With 20 players in the space, consolidation is expected in the coming years. And Manulife is a likely participant.

"In a sense we are an obvious consolidator. This is a scale game," Mr. Roder said at the conference, adding that one of the major attractions of the Standard Chartered deal was the expected cost savings.

No deal value was disclosed, but analyst estimates came in around $400-million to $500-million. While not a huge transaction, the move sheds light on the company's ambitions in Asia – a region that accounts for nearly a third of the insurer's annual profit.

Manulife's deal in Hong Kong was done alongside a 15-year distribution agreement to sell MPF products to Standard Chartered customers.

If that sounds familiar it's because Manulife struck a similar agreement earlier this year with Singapore's DBS Bank Ltd. to sell more insurance and wealth management products to its 6-million customers in Singapore, Hong Kong, China and Indonesia. Manulife is paying $1.2-billion for 15 years of client access in that partnership.

"Unlike that transaction, which serves to broaden the geographic footprint, [the Standard Chartered] acquisition builds on a business in which this company was already on solid footing," said Robert Sedran, an analyst at CIBC World Markets. He said the Standard Chartered deal is an incremental positive.

But these deals come amid mounting concerns over the health of China's economy. Citigroup's chief economist said this week that China could push the world toward a global recession in the coming years, suggesting there was a 55-per-cent chance it would happen.

But Mr. Roder said China has seen worse, saying that the late 1990s were a more volatile period for Asia.

"So yes, we will see some short-term noise, but in the long term it doesn't really change the ... opportunity," he said. "And the really big long-term opportunities in Asia are firstly, from my way of thinking, retirement solutions."

That includes not only Hong Kong's MPF space, but other similar systems yet to be formed in mainland China and other countries such as Vietnam, Mr. Roder said. Having the MPF experience puts the company on good footing to gain licences in these other regions, he said.

As for Manulife shares, analysts say the latest deal is unlikely to cause a big move. That's in part because the uncertainty of an economic downturn in China has already been weighing on the company, according to analyst Peter Routledge with National Bank Financial.

"Recently, the Asia division has exhibited a degree of earnings momentum which, if sustained, will enable the platform to more fully realize its potential as an earnings growth engine for Manulife," Mr. Routledge said in a note, adding that the market still underweights the company's growth potential in the U.S.

"That attribute more than offsets the risk emanating from a potential Chinese recession," he said.

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