CEO of Malaysia’s Great Eastern Takaful steps down amid structural changes (By IFN)

Wednesday 26^th September 2012

MALAYSIA: Islamic Finance news has learnt that Mohamad Salihuddin Ahmad resigned from his position as CEO of Great Eastern Takaful (GE Takaful) on the 21st September 2012, in response to structural changes instituted by the Great Eastern group. Under the changes, Mohamad Salihuddin was to report to Koh Yaw Hui, CEO and a director of Great Eastern Life Assurance (Malaysia), the conventional Life insurance arm of the Great Eastern group, owned by Singapore’s Great Eastern Holdings. Mohamad Salihuddin and Koh also both sit on GE Takaful’s board of directors. Following Mohamad Salihuddin’s resignation, Zafri Abdul Halim, previously the chief financial officer of GE Takaful, has been appointed acting CEO of the firm. It is understood that Mohamad Salihuddin had issued an ultimatum regarding the changes, proposing to resign if the new structure was not revoked. The firm’s Takaful agents are also said to have expressed their discontent over the new measures, organizing a small protest outside the Great Eastern offices recently. Just this month, speculation emerged that Mohamad Salihuddin would be leaving his post by the end of month. In addition to being credited with helping to set up the Takaful operator in 2010, it is also said that he was especially selected by Great Eastern Holdings to head the group’s Takaful venture in Malaysia prior to the firm receiving its Takaful license. While it remains unclear why GE Takaful’s operations were to be placed under direct watch of the group’s conventional arm, it is also speculated that the Takaful unit has seen dwindling shareholder support for its business. This is despite Mohamad Salihuddin’s plans to expand the firm’s operations to Indonesia and clinch a new bancaTakaful deal with Al Rajhi Bank Malaysia by the end of the third quarter of this year, as GE Takaful looked to sign into five new bancaTakaful partnerships by 2015. GE Takaful was set up as a joint venture between I Great Capital Holdings and Koperasi Angkatan Tentera Malaysia. I Great Capital is a subsidiary of Great Eastern Holdings. As at the 30th June 2012, GE Takaful reported a net profit of RM318,000 (US$103,303), against a net loss of RM3.94 million (US$1.28 million) a year earlier.