Malaysia’s Etiqa to shift asset management in-house

Kuala Lumpur-based insurer Etiqa is set to move its investment portfolio in-house, leaving Mayban Investment Management – which currently runs these assets – with its third-party funds, say sources familiar with the organisations.

The move would reverse a four-year-old deal, whereby Mayban Ageas Holdings bought a 100% stake in Mayban IM from Maybank, after which the asset manager started running Etiqa’s investment portfolio. Mayban Ageas is itself 69%-owned by Etiqa International Holdings, a wholly owned subsidiary of Maybank, and Ageas Insurance International owns the other 31%.

Market observers said the split might be related to Maybank’s acquisition earlier this year of Singaporean brokerage Kim Eng Holdings, which has its own asset management arm.

Mayban IM will become part of the global wholesale banking division of Maybank, say sources, and the deal is subject to internal and regulatory approvals, so is unlikely to be finalised this year.

Mayban IM currently manages all 20 billion ringgit ($6.3 billion) of Etiqa’s assets and 4 billion ringgit of third-party assets, according to sources. It is thought that, as a result of the deal, the insurance assets will be managed by Etiqa internally, with some of the former Mayban IM investment team transferring to the insurance firm.

Meanwhile, Etiqa is thought to be carrying out a reorganisation of its investment team and seeking senior executives, who will report to the chief investment officer.

Mayban IM runs both institutional money and wholesale funds – the latter because it does not have a unit trust licence. Sources say both Mayban IM and Etiqa are likely to continue to distribute their products via Maybank branches.

Etiqa, Mayban IM and Maybank all declined to comment for this story.