U.S. President Donald Trump’s push to cut “red tape” and simplify relations between companies and the federal government is good for business, according to the chief executive officer of Canada’s Sun Life Financial Inc.
“We operate in 24 countries and the U.S. has some of biggest red tape we see worldwide,” Dean Connor said in an interview Thursday.
The Toronto-based insurer, owner of the sixth-biggest group benefits business in the U.S., also stands to benefit if Trump succeeds in getting a U.S. corporate tax cut through Congress. “We pay a lot of corporate income tax in the U.S.,” Connor said.
Potential changes to Obamacare are unlikely to affect Sun Life, the second-largest U.S. provider of stop-loss insurance, a product which limits employer exposure to claims, he said.
Connor said he doesn’t see U.S. health regulation changes slowing down health-care expenditures. “Lately, the growth in the health-care costs has been at an accelerated level, particularly because of drugs,” he said in the interview in Toronto following Sun Life’s Investor Day. Job growth in the U.S. is “strong,” he added.
Separately, Connor said he believes there is a residential housing “bubble” in the Toronto and Vancouver markets, though a “manageable” one.
“Cheap debt and ample credit availability have created an asset bubble” in Toronto and Vancouver, he said. “One of the keys will be that we let the air out of bubble slowly, and one of the ways it will come out is higher interest rates. As long as rates move up slowly I think people will be able to manage their way through that.”
Sun Life itself doesn’t have much “direct exposure to residential real estate,” he said.
Connor said he sees Asia as Sun Life’s biggest growth opportunity. The insurer should be able to expand earnings in the “mid-teens” in the region after tripling profit there from $100 million to $300 million in the last five years, he said.