Japanese Fund Acquires 100% Share of Thai Insurance Company

August 21, 2008

APF Group launches insurance business with plans for becoming international standard organization within three years.

Thailand (PRnine – August 20, 2008) – Asia Partnership Fund Group (APF Group) has today launched an insurance business with the 200 million baht acquisition of insurance business from Dumnernchanvanich Group, one of the leading agro-industrial groups. It is expected that within a few years, the company will be an international standard organization.

Plans were also revealed to get support from the strength of other companies within the group before listing on the Stock Exchange of Thailand.

Mr. Worasak Kriangkomol, former Managing Director of Liberty Insurance Co. Ltd, was recruited to be Managing Director of the new company. He is ready to begin and promised the new changes within the 4th quarter. Focus will be made on honest insurance policies and excellent service, not on price competition.

Mr. Mitsuji Konoshita, Chairman of APF Group, said that APF International Co. Ltd., which is a registered company in Thailand, bought 100% of the common stocks of Advance Insurance Co. Ltd. from the former shareholders, Dumnernchanvanich Group. The registered capital was raised from 320 million baht to 477 million baht. As a result, the company will have enough capital required by the OIC regulation. Additionally, the Company’s name was changed to APF International Insurance Co. Ltd. (APFII). This was the first time that the name change was made after APF’s takeover.

He said: “This is the best company. After negotiations with several groups, we found that this is the one with the least problems. We understand that insurance business requires reserve funds to assure the company’s stability and to build confidence among investors and rating companies. Under the operation of APF Groups, all policy holders and partners can be assured that the company will have the financial strength and sufficient cash to pay for the future liabilities”.

Moreover, within the next few years, this company will be an international standard organization, with preparedness in terms of risk-based capital. Besides, enhancement on human resources will be made, both in technical and analytical fields, as well as efficient cost management, state- of- the- art IT systems to support database storage for accurate and reliable use. Additionally, Enterprise Risk Management (ERM) will be applied so that the company will be able to acknowledge and understand potential risks and respond appropriately and efficiently.

Mr. Mitsuji said “We have varieties of business in our group to support one another, especially in terms of Asset Liability Management (ALM), to create a balance between assets and liabilities, and to enhance efficient diversification. We will expedite the recruitment of insurance personnel, especially insurance mathematicians. This is because the change in fund maintenance will make insurance mathematic work more essential”.

In order to improve the operation of APFII, the company also invited a professional who was well accepted among the insurance circle, Mr. Worasak Kriangkomol, former Managing Director of Liberty Insurance Co. Ltd., to be the company’s Managing Director. From now on, despite high competition in the insurance business, the company will always hold on to honesty and quality of service. As an insurer, the company will be responsible for its liabilities.

Mr. Mitsuji said, “We have chosen Mr. Worasak, not only because of his good reputation, but also because he has the same vision as APF Group. Since we are an investment fund, we need to conduct our business with transparency and honesty. We also plan to be a public company within five years. And if the Thai stock market situation is favorable, we will list it on the Stock Exchange of Thailand”.

According to Mr. Konoshita, APF Group will provide assistance to APFII through a management team with experience. IT assistance will be provided by Group Lease Plc. (GL). There will be financial, legal, and professional investment management assistance through United Asset Management Co. Ltd. (UAM) and United Securities Plc., as well as other kinds of support from all affiliates. APF Group has also prepared a billion baht fund to expand APFII’s business. This will finally make APFII a leading insurance company.

Mr. Worasak Kriangkomol, Managing Director of APF International Insurance Co. Ltd., said, as a new management, that no significant business dealing had been made recently since the company was during the stage of finding new investor. It is expected that more changes will be observed by the 4th quarter of this year. Currently, the company is within the reorganization process with the support from APF group of companies.

“Now we are trying to create brand awareness among the people and improve our insurance policies. Some policies that result in loss will be terminated. In general, we will focus our 50% operation on motor and 50% on non-motor businesses. But in practice, our efforts during the initial year may be put into motor business because it is not so difficult. Within the next few years, we should reach our targeted level”.

In the past, the company faced liquidity problems. From now on it has to solve all the existing problems. With the new stable shareholder, warm welcome from alliances is expected. The company believes that, thanks to its new strength, there will be no problem.

“I am here because APF Group is a group of international investors who are well prepared and who really intend to invest, not to seek short-term benefits. They intend to settle down in Thailand. Furthermore, the company already has good foundation. I can start working here immediately. We only have some problems regarding liquidity. Besides, we also have some improvement and adjustment to do with the underwriting, while our marketing team is now ready to go on”.

Despite fierce competition in today’s insurance business, the company is still confident in its ability to compete. More importantly, when there are more companies with problems, the consumers have to choose more. They will not choose an insurance policy with low premium but which is unable to keep its promise. Besides, the company will not continue its low-premium insurance policies if they result in loss. The company believes that its clients will put more emphasis on stability and good service rather than on low premium only.

“Our distinguished feature is financial strength from the support of APF Group. The Group’s management team and I agree that we have to meet all regulations set by the Office of the Insurance Commission (OIC). We are committed to become one of OIC’s green companies. Apart from the issue of capital fund, we also get support on IT system from one of the companies in APF Group. Competition in this business is based on cost. Major companies are able to compete because of their cost advantage. Since we are a middle sized company, we have to manage our cost to be able to compete with big sized companies. Moreover, APF Group emphasizes on transparent management in doing business. This complies with OIC’s regulation and with my management approach, that is, to conduct green business with honesty and transparency. If we see ourselves as consumers, we will know what we want,” said Mr. Worasak.

Keywords: apf, insurance, thailand, Asia Partnership Fund Group, Dumnernchanvanich Group

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Media Contact Information:
A.P.F. International Insurance Co., Ltd
Ms. Samorn Phooim
samorn@bangkokstation.co.th
http://www.asiapartnershipgroup.com