April 18, 2018 / 10:59 AM / a year ago

EXCLUSIVE-Malaysia's Maybank prepares to spin off insurance unit-sources

SINGAPORE/KUALA LUMPUR, April 18 (Reuters) - Malayan Banking Bhd (Maybank), Malaysia’s biggest bank, is preparing to spin off and list its Etiqa insurance arm on the local stock exchange, sources with knowledge of the matter said on Wednesday.

Etiqa, which operates in Malaysia, Singapore, the Philippines and Indonesia, is estimated to be worth at least $1 billion, two sources said. It would have a bigger market value than insurance peer Syarikat Takaful Malaysia Bhd, which is valued at about $700 million.

Maybank’s insurance business is called Etiqa International Holdings Sdn Bhd, which owns 69 percent of Maybank Ageas Holdings Bhd while Ageas, the Brussels-based international insurer holds the remainder. Maybank Ageas owns various Etiqa units.

Maybank and Etiqa had no immediate response to Reuters queries and Ageas declined to comment.

As part of the transaction, Maybank’s investors will receive shares in the insurance company in proportion to their existing holding in the bank, the sources said, adding that no new money is expected to be raised in the listing.

Maybank, Etiqa and Ageas have appointed investment banks for the spin off, said the sources, who declined to be identified as news of the listing is not public.

“The listing will help Maybank unlock value and get it higher valuations,” said a source, adding that Maybank aims to list the insurance business later this year. (Reporting by Anshuman Daga and Liz Lee in KUALA LUMPUR; Editing by Jennifer Hughes and Neil Fullick)

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