Labuan Financial Services Authority issues more than 50% increase in licensing application approvals in the 1st Half 2020, remains cautiously optimistic for the remaining 2020
KUALA LUMPUR, Malaysia, Nov. 13, 2020 /PRNewswire/ -- Labuan International Business and Financial Centre (Labuan IBFC) continues to attract financial services firms from across the globe in 2020 with more than 50% increase in licensing application approvals for the first half of 2020, making a total of more than 800 licensed entities currently operating in Labuan IBFC.
"Notwithstanding the challenges and movement restrictions due to the COVID-19 outbreak, we are glad to continue to have growth, an increase in licenses approved during the first half of 2020," said Datuk Danial Mah Abdullah, Director-General of Labuan FSA in his welcome speech at the third Asian Captive Conference (ACC) today.
"Having said that, we remain cautious on the outcome in the second half of the year but am optimistic that we will pull through this 'COVID-19 rollercoaster year' on a positive note," he went on to say.
He added "We in Labuan FSA are cognisant of the COVID-19 situation. Other than the safety precautionary measures, we have provided Regulatory Reliefs aimed at alleviating the operational difficulties of the market. We will continue to support the market players during this difficult and challenging time as we navigate the "new normal" together. We are always engaging with our players on this."
Mah said that Labuan IBFC as a midshore jurisdiction takes the approach of proportionality in regulation and market engagement, noting this philosophy is appropriate during these times of change and uncertainty, and will serve the jurisdiction well moving forward.
Labuan IBFC is a "whitelisted" jurisdiction by the European Union and deemed largely compliant by the Organisation for Economic Co-operation and Development. With this, coupled with Labuan FSA's continued commitment to adhere to the highest regulatory and supervisory standards, Mah is confident that the global financial services industry will continue to regard Labuan IBFC positively even during these unprecedented times.
Meanwhile, Labuan IBFC Inc. CEO, Farah Jaafar-Crossby said, "The growth in licensed entities definitely evidences Labuan IBFC's relevance as intermediaries continue to look for safe harbour jurisdictions, that are well regulated to international standards set by global multilateral organisations."
Specifically in reinsurance, Labuan IBFC continued to see growth in the insurance industry with 11 new licensed being approved of which seven were captive insurance entities, reinforcing its jurisdictional reign in the Asia captive market.
"Captive insurance is certainly growing in size as it now attributes 31.4% of total gross premiums underwritten in Labuan IBFC, amounting to USD267.9mil with 72.8% of the total captive premiums from international markets," Mah said.
He added: "This is in line with the status of Labuan IBFC as a regional wholesale risk intermediating centre. In fact, for the first half of 2020, 64.5% of total gross written premiums of the reinsurance industry originated from international markets."
"We expect this percentage to increase as we develop Labuan even further as a centre of risk management and reinsurance through innovation. For instance, Labuan IBFC is the only jurisdiction in Asia that offers protected cell companies (PCC)," Mah noted.
He also added that it is a natural progression that as the Labuan community of financial institutions continue to grow, more intra Labuan IBFC trade is effected.
"This is a natural progression of a jurisdiction with more than 800 licensees, with the insurance market representing nearly 30% or 220. As we mature as a financial centre, cross-pollination of businesses is part of a natural development cycle that reinforces a vibrant intra-Labuan business ecosystem for all institutions to partake in," Mah said.
The ACC 2020 is a special virtual edition due to the pandemic and is a collaboration by Labuan IBFC and Pan-Asia Risk & Insurance Management Association (PARIMA). This year, the ACC is hosted as part of the PARIMA Resilience Week of events.
Themed "Agility in the COVID Climate", the ACC 2020 was aimed to highlight the challenges and the agility required for governments, corporations and the community to respond during this pandemic.
The conference also discussed finding suitable risk management approaches and appropriate reinsurance protection where self-insurance may be misconstrued as a panacea during these unprecedented times, and was attended virtually by risk management professionals, business owners, corporate leader, and advisers.
For more information on Labuan IBFC, log on to www.labuanibfc.com.
About Labuan IBFC
Asia Pacific's Midshore International Business and Financial Centre
Labuan International Business and Financial Centre (Labuan IBFC), Malaysia, through our internationally recognised yet business-friendly legal framework, is the preferred international business and financial centre in Asia. Established in 1990, Labuan IBFC is regulated by the Labuan Financial Services Authority (Labuan FSA), statutory Regulator under the purview of the Ministry of Finance, Malaysia.
As a midshore jurisdiction, we offer global investors and businesses the benefits of being in a well-regulated and supervised jurisdiction, which adheres to international standards of compliance in tax transparency. We also provide fiscal neutrality and certainty in a currency neutral operating environment. Labuan IBFC, located in the centre of Asia, boasts a cost-efficient enabling environment making it an ideal location for substance creation for both global businesses looking at penetrating Asia or Asian entities aiming to go global.
Offering a wide range of business structures and investment solutions catered to cross-border transactions and international business dealings including fintech related solutions. We also provide services and solutions in niches such as risk management, commodity trading, reinsurance, wealth management, international business companies and Islamic financial services. Operating with clear and comprehensive legal provisions, guidelines and practice notes, enforced by a single regulator, Labuan FSA, Labuan IBFC provides an ideal jurisdiction for both corporates and high-net-worth individuals with international exposure.
To keep up with everything about Labuan IBFC, follow us on Twitter or @LabuanIBFC. Alternatively, visit www.labuanibfc.com.
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