Maybank and the Islamic Corporation for the Development of the Private Sector (ICD) today signed a memorandum of understanding (MOU) to jointly explore the feasibility of establishing an international takaful holding company with the vision to create a global leader in the takaful business. ICD is the commercial arm of the Islamic Development Bank.
The strategic partnership proposes to leverage on Maybank Group’s expertise in the takaful business as well as ICD’s comprehensive knowledge of the Islamic markets in its member countries. The plan is for the new holding company to commence operations by end 2008.
Under the MOU, the proposed holding company to be set up aims to explore opportunities with the aim of creating takaful companies in both ICD member and non-member countries.
At the signing ceremony, Maybank was represented by its Chairman, Tan Sri Mohamed Basir Ahmad while ICD was represented by Mr Abderrazak Luoati, its Director of Investment.
Speaking at the ceremony, Tan Sri Mohamed Basir said Maybank was honoured to be selected by ICD to work together in this strategic partnership as it will enable the Group to expand its global presence in takaful business as well as help meet the growing needs of customers who require syariah compliant insurance protection in these markets.
“As one of the largest takaful operators in the world, Maybank Group is in a unique position to provide our expertise in the takaful business while ICD will facilitate our joint entry into potential markets,” he said.
He added that ICD which worked for the development of the private sector in its member countries, had strong connections in these markets to enable both parties to provide takaful services via the creation of a network of takaful companies.
“ICD is an ideal partner for Maybank to work with, to take takaful services global,” said Tan Sri Basir. “We believe the opportunities are tremendous given that the global takaful business is expected to grow to over US$15 billion by 2015 from US$2 billion currently as well as the growing acceptance and importance of Islamic insurance schemes globally.
Mr Abderrazak Luoati highlighted the significance of the MOU to the growth of the takaful and financial markets of ICD member countries. He remarked, “The current penetration of takaful is extremely low in most of the Muslim countries. There is huge demand for takaful products, both in general and family takaful segments, and it is expected that the industry will grow further prompted by the booming economies and recognition of social benefits from insurance.”
He further added that this bilateral cooperation between Muslim countries is one of the mandates of ICD and believed that in time, Muslim communities will benefit from this kind of strategic partnership.
Maybank’s takaful business currently has operations in Malaysia and Pakistan.
About the Islamic Corporation for the Development of the Private Sector (“ICD”)
The Islamic Corporation for the Development of the Private Sector (“ICD”) is a multilateral organization, part of the Islamic Development Bank (“IDB”) Group. ICD was established in November 1999 to promote economic development of its member countries in accordance with the principles of the Sharia through private sector development. ICD encourages the establishment, expansion and modernization of private enterprises through financing private sector enterprises or projects. ICD also provides advice to governments and private sector groups on policies to encourage the establishment, expansion and modernization of private enterprises, development of capital markets, best management practices and enhance the role of market economy. As at the end of April 2008, ICD has operations in 19 countries, with the total net approvals under ICD portfolio amounting to USD 744.54.million.