BANKING SECTOR IN LABUAN IBFC RECORDS BEST EVER PRE-TAX PROFIT

KUALA LUMPUR, May 6 (Bernama) -- The banking sector in the Labuan
International Business and Financial Centre (Labuan IBFC) recorded its best ever performance in the financial year 2010, in registering a pre-tax profit of US$536.4 million (US$178.7 million).

This is an increase of 114.8 per cent compared to the US$249.7 million in 2009. (US$1=RM3)

Higher fee-based activities, improved loan recovery and higher net interest income contributed to the significant increase in the pre-tax profits, the Chairman of The Labuan Financial Services Authority (Labuan FSA), Dr Zeti Akhtar Aziz said.

There were 61 approved banks operating in the Labuan IBFC compared to 59 in 2009, she told a press conference to announce the Labuan FSA's 2010 Annual Report here Friday.

Zeti, who is also the Bank Negara Governor, said total assets of the banking industry grew by 13.2 per cent to US$33.9 billion in 2010, driven by higher loans and advances which amounted to US$19.9 billion.

On the insurance sector, she said the total number of approved insurance entities increased to 169 compared to 149 in 2009, while 22 new licenses were approved comprising nine insurance brokers, seven underwritting managers, three reinsurers, two captive insurers and a general insurer.

The gross premiums of the sector continued to surpass the US$1 billion mark for the third consecutive year. Non-resident businesses contributed 52.9 per cent of the total gross premiums.

The total industry assets rose by 26 per cent to US$3.1 billion, Zeti said.

She also said 2010 witnessed a significant growth in the number of Labuan leasing companies, which increased by 29.4 per cent to 176, while assets leased grew by 14.2 per cent to US$25 billion.

The leasing sector was primarily driven by leasing transactions in the oil and gas, shipping, aviation and telecommunications activities.

On Islamic finance, takaful and the retakaful industry, she said total Islamic banking assets grew 63.6 per cent to US$1.3 billion from US$794.7 million in 2009, resulting in a larger market share of 3.8 per cent against the total assets of the Labuan banking industry.

As at end-2010, there were six full-fledged Islamic banks and nine Islamic windows established in the Labuan IBFC.

The takaful and retakaful industry also continued its uptrend with the industry's gross contributions rising by 27 per cent to US$297.3 million. There were seven full-fledged retakaful companies and nine retakaful windows conducting business in Labuan.

Meanwhile, the total number of trust companies increased to 23 with
an aggregate operating income of US$15.4 million in 2010 from the US$13 million in 2009.

For the financial year 2010, the Labuan FSA recorded an operating income of RM22.9 million, while its total reserves stood at RM28.1 million.

Going forward, Zeti said the Labuan FSA has identified several key
strategies to advance Labuan, as an international business and financial centre of choice in the region.

In the pipeline, are several key initiatives under the Malaysian
Financial Sector blueprint with an overarching outcome that is premised on making Labuan into a strong, sound and competitive financial sector with wide international and regional linkages.

Zeti said the blueprint, to be launched soon, would provide a
holistic approach for the development of the Malaysian financial sector for the next decade.