QBE has merged its Latin America and Asia-Pacific operations to form an emerging markets division.

The unit will be led by current Asia-Pacific Operations CEO David Fried, who takes up the new position on August 15.

Latin America Operations CEO Jose Sojo will leave QBE at the end of the year for “a new challenge outside our group”, QBE says.

The Latin America division employs 1100 people and posted gross written premium (GWP) last year of $US1.38 billion ($1.47 billion), up 13%. 

The Asia-Pacific arm employs 1450 people and had GWP last year of $US730 million ($776 million), up 26%.

Deutsche Bank analyst Kieren Chidgey says the merger of the two divisions is “sensible from a leadership point of view”. 

“The creation of the [emerging markets division] highlights QBE’s organic growth ambitions,” he told insuranceNEWS.com.au.

“In that regard it makes sense to have it under single leadership. It brings capital allocation decisions and decisions about the best opportunities in both regions under one person.”

Morningstar Head of Australian Banking Research David Ellis says merging the “small but fast-growing” Asia-Pacific unit with the “underperforming” Latin America operation allows “the newly integrated and streamlined division to focus on building a substantial and profitable emerging markets presence”.

Mr Ellis expects the merger “will generate meaningful cost savings”.