KUALA LUMPUR (Aug 30): Affin Bank Bhd has completed its partial disposals of equity interests in its joint ventures (JVs), AXA Affin Life Insurance (AALI) and AXA Affin General Insurance (AAGI), to Generali Asia NV.

The unit of Italy's largest insurer, Generali, has acquired a 70% stake in AALI (49% from AXA and 21% from Affin Bank) and about 53% in AAGI (49.99% from AXA and 2.95% from Affin Bank).

With Affin Bank's completed equity disposals, coupled with AXA's sale of its entire equity interests in AALI and AAGI to Generali Asia, Generali has become Affin Bank's new JV partner in the insurance operations.

In a statement on Tuesday (Aug 30), Affin Bank said the pair plan to integrate the businesses of MPI Generali Insurance Bhd and AAGI — whereby Affin Bank will hold 30% equities in both AALI and AAGI upon full integration. Prior to the completed deal, Affin Bank owned a 51% stake in AALI, and 49.95% in AAGI.

The bank noted that the combined general insurance entity is set to be the second largest general insurance provider in Malaysia with estimated gross written premiums of over RM600 million in the first quarter of 2023.

"Affin Bank had also [on Tuesday] signed a 15-year bancassurance distribution agreement with AAGI and AALI for the distribution of the general and life insurance products through Affin Bank's channels in Malaysia," it added.

Commenting on successfully joining hands with Generali Asia for the JV, Affin Bank president and group chief executive officer Datuk Wan Razly Abdullah Wan Ali said the bank is pleased to work with Generali Asia to further expand the bank's insurance capabilities in Malaysia and construct a more complete banking and wealth management platform for both corporate and retail clients.

"Our bancassurance partnership with Generali Asia showcases Affin Bank's commitment to offering holistic financial solutions to our customers and enhancing the overall customer experience," he added.

Meanwhile, Generali International Asia regional officer Rob Leonardi dubbed the JV as a unique opportunity for the parties to synergise their talents and resources to craft a unified brand equipped with scale, breadth, and capabilities to compete more effectively and profitably in the Malaysian insurance market, providing greater value for its customers.

The deal between Affin Bank and Generali was reached on July 22 last year, with Affin Bank agreeing to dispose of its 21% stake in AALI and approximately 2.95% stake in AAGI to Generali Asia.

After receiving requisite approvals from Bank Negara Malaysia and the Ministry of Finance, the pair entered into a share sale agreement on May 18 this year for the disposals.

The total consideration for the combined transactions between Affin Bank and Generali was RM155.54 million in cash, according to a filing on May 18.

At 3.52pm, shares in Affin Bank were down one sen or 0.48% to RM2.08, giving the group a market capitalisation of RM4.6 billion.