RAM Ratings affirms Manulife Holdings' AA2/P1 ratings, outlook stable

RAM Ratings has affirmed Manulife Holdings Berhad's (MHB or the Group) corporate credit ratings (CCRs) of AA2/Stable/P1. The ratings mirror the credit profile of the Group's core insurance subsidiary, Manulife Insurance Berhad (MIB), and is not adjusted for subordination given the debt-free status of MHB. The CCRs also incorporate an uplift based on RAM's assessment of likely parental support from Manulife Financial Corporation (MFC), in light of the strong ties between the two entities and MFC's Asia-focused growth strategy.

On a standalone basis, MHB's credit profile benefits from MFC's global branding and market positioning, alongside MIB's healthy capitalisation and liquidity position, conservative reserving and good product persistency. MHB's asset management
business also adds a degree of earnings diversification and stability. In 2024, MIB's new business (NB) generation increased by a stronger 24.7% (2023: 12.4%), led by robust sales from the bancassurance channel which accounted for 65% of NB. While the bulk of this was for single-premium policies, the 15-year bancassurance partnership with Alliance Bank Malaysia Berhad helps ease concern around the sustainability of growth.

The small scale of MHB's life insurance and asset management businesses remains a key rating constraint. As at end-March 2025, both MIB and Manulife Investment Management (M) Berhad held market shares of less than 3% in their respective segments. This limited operating presence contributes to MHB's moderate profitability. The Group's pre-tax return on assets ranged from 0.4% and 2.5% between FY Dec 2022 and 1Q FY Dec 2025, with stronger years typically lifted by investment results which can be volatile. Insurance service results  an indicator of underwriting profits - remained limited, staying below RM100 mil in the last three years.

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