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UPDATE 3-Prudential seeks larger slice of life in China as Asia drives profit

* New-business profit jumps 17 pct to 2.47 bln stg

* Asia new-business profit jumps 15 pct to 1.61 bln stg

* Seven Asian countries show double-digit growth

* Shares up 0.8 pct in flat FTSE 100

* Share performance vs peers: http://bit.ly/2zJnEdz (Recasts, adds detail on Asia plans from Investor Day, background, updates shares)

Nov 16 (Reuters) - Prudential expects its Asian business to double in size every five to seven years, the British life insurer said after reporting the region drove a 17 percent rise in new business profit during the first nine months of 2017.

New business profit of 2.47 billion pounds ($3.25 billion) was driven by higher sales and favorable economics, Prudential said ahead of an investor day on Thursday.

Asia was "in some ways, ours to lose," Prudential Chief Executive Mike Wells said in a statement which showed new business profit in the region rose 15 percent to 1.61 billion pounds, helped by higher sales and rising interest rates.

Panmure Gordon analyst Barrie Cornes flagged Prudential as a 'buy' in a note to clients following the results and its shares were up 0.8 percent at 1119 GMT, outperforming a flat index.

Seven countries clocked double-digit growth in Asia, including Hong Kong, Singapore and China, which said last week it would ease foreign ownership curbs in the financial sector, with the limit on insurance companies due to be raised to 51 percent after three years, and fully removed after five.

Asia Chief Executive Nic Nicandrou told Prudential's investors it would like to have a bigger share of its life insurance business in China, where it has a 50:50 joint venture with financial conglomerate CITIC Group.

Market gains helped Eastspring, the firm's Asian asset management business, deliver year-to-date external net inflows of 2.8 billion pounds, and Prudential said it was also looking to China to help drive future growth.

Guy Strapp, chief executive of Eastspring Investments, told investors the unit was in the process of setting up a wholly-owned unit in China to manage non-retail funds, to add to a joint venture with CITIC that manages retail funds.

Strapp said Eastspring was recruiting to establish an onshore investment team in China, the world's second-biggest economy and which is expected to account for 49 percent of Asia's total fund under management by 2020.

The plans to expand in China come as Prudential and rivals such as AXA back out of some markets, including Vietnam where the British firm is selling consumer finance to focus on insurance.

NO DECISION ON LEGACY BOOK

While analysts were hoping for an update on a mooted sale of Prudential's legacy book of UK annuity business, Wells said no decision had yet been reached, but should the insurer sell some or all of it, excess capital would be returned to shareholders.

Across the group, gross annual premium equivalent (APE) sales, which include regular premium sales plus one-tenth of single premium insurance sales, rose to 5.17 billion pounds, from 4.47 billion pounds a year earlier.

In the UK, new business profit rose 31 percent to 234 million pounds in the insurer's recently merged insurance and fund management unit, helped by strong demand to invest in the group's asset management products.

M&G Prudential delivered external asset management net inflows of 9.9 billion pounds in the first nine months, with total assets under management rising to 336.5 billion pounds.

In the United States, where Prudential operates through its Jackson division, new-business profit rose 28 percent on an actual exchange rate basis to 619 million pounds, driven by higher interest rates. ($1 = 0.7593 pounds)

(Additional reporting by Sumeet Chatterjee; editing by Gopakumar Warrier/Amrutha Gayathri/Alexander Smith)