Zurich Insurance Group is engaged in discussions with South African financial services firm Sanlam to divest its 40% stake in MCIS Zurich Insurance.
Sources familiar with matter were quoted by The Star as saying that the Swiss insurance firm previously said that it is searching for a suitable buyer for its stake in MCIS Zurich.
In 2001, Zurich Insurance combined its Malaysian operations with MCIS to establish MCIS Zurich. The Swiss insurer purchased Malaysian Assurance Alliance (MAA) in September 2011.
The move comes after, Bank Negara Malaysia, the country’s central bank, mandated that no foreign company can own more than one insurance operation in the country.
The sources told the news portal that both Zurich Insurance and Sanlam were still in discussions.
A Zurich-based official from Zurich Insurance was quoted by the news site as saying, "We are working with other stakeholders in MCIS Zurich to resolve the issue of Zurich’s interest in two licences and are confident that the situation will be regularised well within the deadline that the central bank has given to us on this matter."
The Swiss insurer is strengthening its presence in Malaysia as its unit Zurich Insurance Malaysia and Bank of China have signed a memorandum of understanding (MoU) to explore bancassurance opportunities in Malaysia in January 2014.
————————————————————————————————————————————————————————————————Image: Zurich Corporate Center, Mythenquai 2, Zurich. Photo courtesy of Zurich Insurance Company Ltd.