[RAM] RAM Ratings affirms MNRB's and Malaysian Re's ratings

RAM Ratings has affirmed the ratings of MNRB Holdings Berhad (MNRB or the Group) and those of its wholly-owned subsidiary, Malaysian Reinsurance Berhad (Malaysian Re or the Reinsurer), as listed in Table 1.



The ratings of the Group are supported by the strong financial profile of its core subsidiary, Malaysian Re, given the latter’s strong market position in Malaysia’s domestic reinsurance market, and adequate capitalisation of the Group’s key operating subsidiaries. Malaysian Re has consistently accounted for the lion’s share of the domestic general reinsurance industry’s gross premiums (2023: 64%; 2018-2022: 60%-70%), thanks to regulatory voluntary cession (VC) arrangements which contribute about half of the Reinsurer’s domestically sourced premiums.

MNRB’s own ratings incorporate structural subordination from Malaysian Re’s credit profile (as a non-operating holding company), and our expectation that the Group will keep leverage “moderate” (defined as gearing and double leverage ratios of no more than 0.5 times and 1.4 times, respectively). As at end-December 2024, these ratios stood at a respective 0.3 times and 1.0 times.

The capital adequacy ratios of the Group and its key operating subsidiaries as at end-December 2024 stayed above the respective individual target capital levels and the regulatory minimum of 130%. Deemed sufficient considering the subsidiaries’ healthy reserves coverage, these levels are envisaged to be supportive of the entities’ growth plans in the near to medium term.

MNRB’s pre-tax profit increased multifold to RM506 mil in FY Mar 2024 (FY Mar 2023: RM145 mil), mainly owing to the strong showing of subsidiaries Malaysian Re and Takaful Ikhlas General Berhad. Both entities reported healthier topline growth and claims experience which consequently boosted underwriting profitability, with investment income also a contributing factor. The discounting effect on insurance contracts (arising from bond yield movements) partially moderated these gains. The positive performance continued in 9M FY Mar 2025, driving MNRB’s pre-tax profit up to RM352 mil (+51% y-o-y; 9M FY Mar 2024: RM233 mil). Unfavourable foreign exchange movements and a heftier cost load, however, negated some of these gains on the Group’s bottom line. 

The inherent volatility of the reinsurance business, the risk of non-renewal of VC arrangements and challenging prospects for the takaful subsidiaries continue to weigh on the Group’s credit profile.


Analytical contacts
Loh Kit Yoong
(603) 3385 2493
kityoong@ram.com.my

Sophia Lee
(603) 3385 2619
sophia@ram.com.my

Media contact
Sakinah Arifin
(603) 3385 2500
sakinah@ram.com.my