Malaysia: Etiqa has strong potential for overseas growth
Source: Middle East Insurance Review | Dec 2018
Etiqa, the insurance and takaful business unit of Malaysia’s Maybank, has strong potential for growth in overseas markets like Singapore, Indonesia and the Philippines, according to CIMB Equities Research as reported by The Star.
Maybank has strong footholds in commercial banking in these markets, said the research firm, and Etiqa can leverage this regional network to grow its business.
“It has shown positive results in this regard as out of Etiqa’s gross premium of MYR6.2bn in 2017, MYR900m was generated from Singapore and MYR200m from the Philippines,” CIMB Equities Research said.
Maybank said Etiqa is the fastest-growing insurance and takaful company in Malaysia year-to-date in all segments, including life insurance, family takaful, general insurance and general takaful.
“While we are positive on the growth prospects for Maybank’s insurance as well as Islamic banking businesses, we think these could be partly offset by the weak expansion of its commercial banking operations, impacted by slow loan growth and margin erosion,” said the research firm.
“As such, we continue to rate Maybank a ‘Hold’, partly premised on its attractive dividend yield of a projected 5.9% in FY19F. We prefer RHB Bank for exposure to Malaysian banks,” it said. M