Thursday, October 19, 2017

No buyers for troubled insurer Bumiputera

The Indonesian government is likely to consider some form of state aid to troubled life insurer Bumiputera as efforts to find a strategic investor remain futile.

Bumiputera, formally known as Asuransi Jiwa Bersama Bumiputera 1912, still has liabilities of around Rs20 trillion (US$1.4 billion) despite restructuring carried out by Indonesia’s Financial Services Authority since 2013.

Bumiputera approached a number of foreign companies in the last few months, including Hong Kong’s FWD Group and the UK’s Prudential, but no firms have expressed interest.

FWD walked away from talks with Bumiputera mainly due to concerns about its liabilities, sources said.

Authorities said they are doing their best to make sure that government funds will not be used to resolve Bumiputera’s woes.

However, Peter Meyer, services committee chair at the American Chamber of Commerce in Indonesia, told Reuters a potential government bailout might have to be seriously considered.

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