On Wednesday, Malaysia’s MNRB Holdings Berhad (MNRB) reported its results for the financial year ending 31 March 2024, which the group labelled as “its best-ever financial performance in its 50-year history.”
The group, which comprises reinsurance, retakaful, and two takaful operators, saw its profit after tax (PAT) increase over 200% to reach RM428.4m (US$90.34m) for the year, MNRB said in a release. Malaysian Re contributed significantly, surpassing the RM2bn mark in Gross written premiums and contributions (GWP/GWC) for the first time.
The group’s overall GWP/GWC hit RM4.0bn for FY2024, up 17.6% from RM3.4bn in 2023. Revenue from its insurance and takaful operations climbed 21.1% to RM3.6bn.
Datuk Johar Che Mat
MNRB ChairmanMNRB’s PAT surged to RM428.4m, from RM 142.6m the year prior. Its reinsurance/retakaful business saw RM362.4m of this PAT, fuelled by “strong underwriting results coupled with robust investment performance,” MNRB said. It added that profitability was further strengthened by the takaful segment’s “solid business fundamentals and operational efficiencies.”
Datuk Johar Che Mat, MNRB Chairman, highlighted the strategic initiatives and effective collaboration across the company as key drivers of the year’s success.
“Our credible performance reflects our commitment to excellence and sustainable growth, facilitated by effective collaboration across the Board, Management, and staff. Key to our success has been the rollout of strategic initiatives across all business lines,” he stated.
The Group’s investment income also reached a five-year high at RM588.3m, a 61.3% increase from FY2023, with a yield of 5.64%.
The group returned to the capital market in FY2024 with the issuance of a Sukuk Murabahah, an Islamic bond, which saw a five-fold oversubscription, MNRB said. En. Zaharudin Daud, MNRB President & Group CEO, noted the Sukuk issuance “has helped bring down the cost of capital and provided MNRB with the flexibility to execute the Group’s transformation effectively.”
Malaysian Re hits record GWP/GWC
Malaysian Re recorded a GWP/GWC of RM2.5bn, surpassing the RM2.0bn mark for the first time. This performance placed Malaysian Re as the leading reinsurer in ASEAN by GWP, MNRB noted.
Malaysian Re’s Profit After Tax (PAT) for its reinsurance/retakaful business increased by 146.0%, reaching RM362.4m, up from RM108.2m in the previous financial year. This growth was supported by increased insurance service results to RM339.2m from RM40.1m and better-than-expected-investment outcomes.
The company’s achievements follow a strategic business revision started in 2021, aimed at expanding Malaysian Re’s business scope and reducing the impact of natural catastrophes.
The strategy has focused on diversifying its portfolio, exploring new sectors such as speciality lines and renewable and green energy, and enhancing capital management. The implementation of these initiatives, coupled with effective cost management, is reflected in a combined ratio of 95.5%, showing a four basis points year-on-year improvement.
“This approach, which positioned the company to navigate challenges and capitalise on opportunities, enabled its international business to grow by 14.2% to RM513.5 million in FY2024,” MNRB said.
Last financial year also saw Malaysian Re play a crucial part in the development of the ASEAN Renewable Energy Pool (see story below). On 8 Dec 2023, members of the ASEAN Reinsurance Working Committee (ARWC) signed a Memorandum of Understanding (MOU) that laid the foundation for the pool’s creation.
This initiative, managed by Malaysian Re, aims to pool risks associated with renewable energy projects within the ASEAN region, facilitating capacity to help manage these risks more effectively. Other participating ARWC members include Indonesia Re, Vietnam National Reinsurance, Cambodia Re, Thai Re, and the Philippines’s Nat Re.
Takaful gains
Takaful IKHLAS, which consists of Takaful Ikhlas General Berhad and Takaful Ikhlas Family Berhad, reported a GWC of RM1.6bn for the financial year ending 2024, MNRB reported. The result means Takaful IKHLAS has seen a Compound Annual Growth Rate (CAGR) of 10.5% over the past three years.
In FY2024, Takaful IKHLAS saw its PAT increase by 43.5% to RM73.6m, “on the back of robust growth in its general takaful business, and stability within its family takaful segment,” MNRB said, adding that these segments have consistently provided dividends to the Group annually.
Takaful IKHLAS General reported a GWC of over RM800m for the first time, marking a 20.4% increase from the previous year and a significant rise from RM345m in FY2020. Its PAT surged by 55.1.0% to RM63.5 million. Its underwriting result was attributed to a “solid understanding of the takaful businesses, its ability to manage risks by targeting a preferred risk portfolio, and by withdrawing from segments that were deemed not profitable.”
Takaful IKHLAS Family reported a GWC of RM710m and a PAT of RM10.1m for FY2024. 2024 was a year of consolidation, MNRB said, with the company focused on efforts to recalibrate its business model, including product reviews, repricing, and optimising capital efficiency.
“Moving forward, the family takaful business is expected to generate better growth and profitability,” MNRB said in its announcement.
Overall, Takaful IKHLAS contributed 39.1% to the Group’s GWP/GWC and 17.2% to its PAT.
Summarising a record-breaking year, Johar concluded, “The team at MNRB takes pride in our outstanding FY2024 performance, which has reinforced shareholders’ trust in the Group. Our strong business fundamentals and strategic initiatives position us well to continue navigating future challenges and seizing opportunities effectively.”
