Australian financial services firms are failing to make the most of considerable new opportunities in Asia, Axa Asia Pacific CEO Andrew Penn says.

Speaking at the Financial Services Institute of Australasia (Finsia) Asia Financial Services Summit 2010 last week, he forecast strong demand for financial services in the region on the back of forecast growth of 7% per year during this year and next.

But he says that despite those strong prospects, Australian firms – including insurers – have little or no presence in the region.

“Our regional competitors among the international companies come from continental Europe, the US and the UK – they do not come from Australia,” he said.

“Ten years ago there were more Australian insurance companies doing business in the region than there are today.”

Axa Asia Pacific currently operates in eight countries across Asia, with its original $50 million acquisition of Hong Kong business Sentry in 1986 growing to a business today worth $9.4 billion.

Mr Penn says Australia’s ambitions as a financial services centre are enhanced by a professional industry, robust legal system and skilled resources. But he believes an “over-zealous” approach to regulation could undermine those prospects.

For example, a proposal to introduce greater conglomerate group regulation would create difficulties for international operations run from within Australia, he said.