HSBC Malaysia is set to sell its 49% stake in a local life insurance joint venture to Hong Kong-based FWD Group after receiving regulatory approval.
The Malaysian central bank approved the deal for HSBC to divest the share in Malaysia-based HSBC Amanah Takaful Malaysia Bhd and it is expected to be completed in the first half of 2019.
The financial details of the transaction were not disclosed.
Stuart Milne, HSBC Malaysia chief executive, said: “We have decided to exit the takaful manufacturing business and focus on our banking operations in Malaysia.”
He added the bank would continue to distribute insurance products in the market.
Takaful refers to Islamic insurance products. In the financial sector, takaful firms follow religious guidelines including bans on interest and monetary speculation, and a prohibition on investing in industries such as alcohol and gambling.
FWD Group
It was announced in August that FWD had agreed to buy the 49% stake in HSBC Amanah Takaful as part of its plans to ultimately own a majority of the company by buying some shares from the existing partners.
Malaysia’s JAB Capital Bhd owns 31% in the venture, while Employees Provident Fund Board of Malaysia controls the remaining 20%.
FWD will look to add to its Asian market operation with offices Indonesia, Japan, Singapore, the Philippines, Thailand and Vietnam.
