IBFC continues to register positive growth amid challenging environment

LABUAN: The Labuan International Business and Financial Centre ( IBFC) has continued to register positive growth in its key business areas of banking, reinsurance and wealth management, despite the challenging environment.

Bank Negara Malaysia Governor Datuk Muhammad Ibrahim said the IBFC remained resilient, with sustained financial stability and integrity and more importantly, investor confidence and business prospects, remain strong.

He said Labuan was now home to more than 13, 260 companies with diverse geographic origins.

“Labuan position as Asia’s business and financial gateway is underlined by the composition of companies, with 70 per cent of the establishments originating from within the region.

“Consistent with global trends, the growth of the Labuan companies incorporated in the IBFC moderated to 6.3 per cent in 2016 compared to 7.2 per cent in 2015,” he added.

Muhammad said this at the presentation and briefing on the Labuan Financial Services Authority Annual Report 2016 here today.

He also said the Labuan banking sector continued to support financial intermediation in the region.

“This sector registered a steady growth of assets of 7.6 per cent to US$ 51.0 billion in 2016. Total loans outstanding stood at US$ 431.8 billion with non-residents accounting for 62.4 per cent of the total, “he added.

Muhammad said borrowers from ASEAN countries made up the largest share, with total outstanding loans of US$ 22.8 billion.

Transportation, storage and communications were the major business lines funded by Labuan banks, contributing about 18 per cent of total loans.

“While the sector’s profit before tax moderated to US$ 551.5 million, balance sheets remained healthy with further improvements in asset quality and adequate capital buffers,” Muhammad said. — Bernama