The paucity of data on captives needs to be addressed as a matter of priority, according to Muhammad bin Ibrahim, governor of the Central Bank of Malaysia.
Speaking at the Asian Captive Conference on 16 August, Ibrahim acknowledged that macro-prudential measures to address financial stability issues in captive insurance might have relevance in certain circumstances, such as a pure captive parent that is an economically significant entity.
He said: “To a large extent, our ability to design suitable regulatory frameworks for captives remains constrained by the paucity of data on captives. This needs to be addressed as a matter of priority.”
“Broader measures need to be taken, both at a national and global level, to collect better data on captives to understand their nature, evolution and impact on macro-financial developments.”
This and other changes “are likely to pick up speed for captives”, according to Ibrahim.
Captives could transform “from perceived brass plates models into legitimate commercial vehicles that serve a real economic purpose”. He added: “Perception management is pivotal for the future existence of captives”.
