Sunday, August 17, 2008

Labuan IBFC to expand in Asia, Mideast

Petaling Jaya: Labuan IBFC Inc Sdn Bhd, the marketing arm of Labuan Offshore Financial Services Authority, will set up offices in the Asian region and Middle East within the next 12 months.

Chief executive officer Martin Crawford said however details had yet to be finalised.

“We could be setting up an office in Dubai or Abu Dhabi. We might co-set up the office with Malaysian Industrial Development Authority or local legal firm Zaid Ibrahim & Co,” he said, adding that Labuan IBFC hoped to have a presence in the Middle East in six to eight months.

“The next office could be in Hong Kong.

“We need to convince professionals in Hong Kong that there is something Labuan could offer them,” Crawford told a media briefing yesterday.

To a question, he said Labuan IBFC was targeting the 500 top conglomerates in Asia to set up captive insurance companies in Labuan.

He said 64% of the top 500 companies in the United States had a captive insurance company. In contrast, less than 10% of the 500 top conglomerates in Asia had captive insurance companies.

Labuan IBFC also plans for roadshows in selected countries and will be advertising and developing an online resources centre.

“We are also keen to tap into newer emerging markets for offshore investment flows such as India, China and the Gulf Cooperation Council (GCC) region.

“We will be conducting a roadshow in Hyderabad and Mumbai in India next week,” Crawford said, adding that India had been identified as a high potential market.

Indian investors had been active in trading, mergers and acquisitions or in supporting their burgeoning information technology industry, he said.

“To date, many of these offshore investments have been routed through Mauritius or Singapore. Labuan has many advantages over these traditional jurisdictions but many Indian businessmen are not aware of this.

“Labuan is an unpolished gem that can be sold to the world. I am sure it has the potential to be a leading business and financial centre in the region once we have polished it,” Crawford said.

He said Labuan IBFC would focus on five key areas: international holding companies, private and public investment banks, captive insurance, Islamic finance and wealth management products such as expatriate pensions.

To date, Labuan IBFC has registered US$14.7bil in approved leasing transactions; US$16bil debt issuance by corporations; US$6.4bil in private funds approved; US$4.2bil in Islamic notes listed on the Labuan International Financial Exchange; US$3.8bil in non-securities capital raised via Labuan companies and US$700mil in insurance premium.