THE Maybank group has signed a memorandum of understanding (MOU) with PT Panin Life Tbk of Indonesia for both parties to commence discussion on a possible joint venture partnership via the acquisition of a 60 per cent stake in PT Panin Life's subsidiary, PT Anugrah Life Insurance.
PT Panin Life also owns a 45 per cent stake in Panin Bank, which is one of the top 10 banks in Indonesia.
Should the joint venture partnership materialise, PT Anugrah Life Insurance will tap on the expertise of the Maybank group to replicate its highly successful bancassurance business model currently used in Malaysia and make it available to the distribution network of clients of Panin Bank, which has 262 offices throughout Indonesia.
Signing the MOU was Maybank president and chief executive officer Datuk Amirsham A. Aziz while PT Panin Life was represented by its president director Fadjar Gunawan.
The signing was witnessed by Maybank chairman Tan Sri Mohamed Basir Ahmad as well as Mu'min Ali Gunawan, president commissioner of Panin Life and Panin Group chairman and founder.
In a Maybank statement released yesterday, Amirsham said the MOU paves the way for the Malaysian banking group and Panin to develop a significant presence in consumer financial services in Indonesia.
"Ultimately, we aim to be one of the most cost-efficient insurance companies in Indonesia," he said.
Internationally, Maybank's insurance and takaful arm is already present in Pakistan, Brunei Darussalam and Singapore.
The Maybank group currently has commercial banking operations in Indonesia with three branches in Jakarta.
Insurance and takaful collect RM26.6bil in premiums
THE insurance and takaful sector recorded combined premiums and contributions of RM26.6bil last year.
This represented an increase of 6.8%, the bulk of which came in the second half as expectations for a further increase in interest rates lessened and households and businesses became used to the higher cost of living.
In the life insurance and family takaful sector, new business premiums and contributions posted a growth of 13.5% to RM8.4bil (2005: RM7.4bil) in 2006.
Growth was driven primarily by investment-linked business, which expanded at an impressive annual rate of 89% to RM3.4bil to offset the decline in ordinary life business. At the close of the year, investment-linked products accounted for more than 40% of new business.
In terms of distribution channels, new premiums garnered through bancassurance tie-ups accounted for a higher share of 44.2% (2005: 41.8%), while the market share of agency business fell to 44.8% (2005: 46%).
The general insurance and takaful sector grew at a more moderate pace during the year. Gross direct premiums and contributions rose 4.1% to RM10.3bil (2005: 9.8%). This was underpinned by lower business volumes in the motor sector as well as softening of premium rates for commercial property, aviation and cargo risks. The takaful industry recorded a strong performance during the year. Total assets grew 17.9% to account for 6.1% of the total assets of the insurance industry.