AIA Myanmar, which is wholly owned by Hong Kong-based insurer AIA Group Ltd, says it will only invest in Myanmar government bonds even though it can also hold other securities in its investment portfolio, according to a local English language daily.
Insurance companies in Myanmar are allowed to invest in securities such as stocks and corporate bonds though 30% of their capital must be used to purchase government bonds.
But AIA Myanmar’s investment portfolio only consists of government bonds, the Myanmar Times says in a report on May 13, quoting Luc Nhon Ly, the company’s chief executive officer. He does not provide a reason for such a conservative investment strategy.
“They [the government] have auctions almost every month, and we do participate in those auctions when we have the capital,” he says.
Mr. Ly also says AIA Myanmar has shifted its business model to place greater emphasis on its online platform in the wake of the coronavirus pandemic.
“For the insurance industry, we do a lot of gatherings, training, and planning sessions. But we cannot do that anymore. So, we quickly adjusted, and moved everything online,”
The company is also selling products remotely.
“Products can be sold through video conference calls…We can send a document electronically for them [clients] to sign and they will send it back to us,” Mr. Ly says.
AIA Group is one of only five foreign insurers that have been allowed to set up wholly-owned units in Myanmar. The others are Japan’s Dai-ichi Life Insurance Co, Switzerland’s Chubb Ltd, Canada’s Manulife Financial Corp, and Prudential plc of the UK.
All five received their licences last November.
AIA Group had US$284 billion of total assets as of end-2019.
