Allianz Malaysia’s second quarter bottom line sags 12.9%

PETALING JAYA: Allianz Malaysia Bhd’s net profit fell 12.9% to RM66.48 million for the second quarter ended June 30, 2017 against RM76.29 million in the same quarter a year ago, due to lower contribution from the life insurance operations. Its revenue was up by 3.9% from RM1.15 billion to RM1.19 billion.

The group saw its first-half net profit decline 10.6% from RM149.47 million to RM133.65 million, with revenue rising 3.8% from RM2.32 billion to RM2.4 billion.

The insurer said in a filing with Bursa Malaysia that a total of RM2.2 billion was recorded in gross written premiums from January to June this year, representing a 3.9% growth compared with RM2.11 billion last year.

It expects the competition to intensify for the general insurance business following the second phase of motor and fire detariffication commenced in July 2017, where insurers have the flexibility to deviate pricing for the motor and fire portfolios within certain regulatory allowances.

“The general insurance subsidiary has taken key initiatives to remain competitive in this environment including building a technical pricing model, active portfolio and claims management as well as disciplined expense management,” it noted.

For the life insurance business, Allianz said it will focus on strengthening its distribution channels through the professionalisation and increased productivity of its agency force.

“It will generate growth from its investment-linked business with rider attachments, which cater for customers’ protection needs,” it added.

Allianz said it is confident that the insurance operations will continue to deliver satisfactory results in the remaining year.

At yesterday’s market close, its shares were unchanged at RM14.52, with some 24,900 shares changing hands. It has a market capitalisation of RM2.53 billion.