Published May 6, 2009

Malaysian business gives Great Eastern Q1 boost

By GENEVIEVE CUA

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GREAT Eastern Holdings has announced a strong set of results for the first quarter, thanks to strong growth in its Malaysian business.

More assuring: Profit attributable to shareholders rose sharply to $237 million from $45 million previously

Profit attributable to shareholders rose sharply to $237 million from $45 million previously, due to a large non-recurring item in its Malaysian operations.

A non-recurring profit of $213 million arose out of the implementation of a new risk-based regulatory capital framework in Malaysia. In Singapore, the group also began an exercise to achieve portfolio matching of assets and liabilities of the non-participating fund. This also contributed to the one-time profit.

Excluding the non-recurring item, profit grew to $64.5 million from $14.4 million previously.

New business life assurance sales fell 25 per cent on a weighted basis to $130 million, mainly due to a 55 per cent fall in the Singapore business. But Malaysia saw strong growth of 63 per cent in new business weighted premiums.

Group chief executive Ng Keng Hooi said: 'The ongoing financial crisis and recessionary conditions will likely impact the earnings of the insurance operations, and the group will therefore continue with the exercise to manage its portfolio of assets and liabilities to minimise future earnings volatility.

'We are able to reassure our customers that the group is strongly capitalised with capital adequacy ratios in excess of 200 per cent in our key markets of Singapore and Malaysia, and that the capital position is able to withstand further deterioration of the financial markets through the results of our regular stress tests.'