MAYBANK: ATTRACTIVE PROSPECTS FOR ETIQA

KUALA LUMPUR: Malayan Banking Bhd (Maybank) expects its insurance and takaful arm, Etiqa Group Insurance & Takaful, to attract more investors as interest rates in the country rise.

“The insurance portfolio becomes attractive as interest rate increases.

“Insurance and takaful is usually a long-term business and an increasing interest rate environment is good for long-term earnings and return of equity for the insurer,” said Maybank group president and chief executive officer Datuk Abdul Farid Alias said at the banking group’s annual general meeting, here, recently.

He said the group was not taking Etiqa public anytime soon.

“We will be more aggressive in our offerings as Etiqa plays a big part of Maybank 2020’s strategic objectives. We believe that the improved economic outlook this year will remain the backbone of Etiqa’s growth.

“We will introduce value-added products and widen our footprint in Asean this year. Among these are investment-linked products, which will benefit investors if the equity market and the ringgit strengthens.”

He said the insurance and takaful portfolio played a big part in the group’s overall business.

“We saw Etiqa hitting record top line and profit-before-tax of RM6.19 billion and RM1.01 billion, respectively, last year.

“We also saw strong growth in bancassurance business of more than 23.8 per cent year-on-year. As of December last year, Etiqa was a premier online insurer in Malaysia with more than 70 per cent market share.”

Etiqa is also present in Singapore (via Etiqa International Pte Ltd), the Philippines (via AsianLife and General Assurance) and Indonesia (via PT Asuransi Asoka Mas).

Bank Negara Malaysia has set a target for the life insurance and family takaful industry to achieve a penetration rate of 75 per cent of the population by 2020.

The takaful industry has set a 25 per cent penetration target, also to be achieved by 2020.