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INTRODUCTION

Banks and non – bank institutions aim to gain high profits from doing its sales and purchase

activities. Bank makes money by receiving money and lending it back as loans to customers. The
interest charged on the loans is a major way for bank to make money. Banks also offer service

for people that want to make savings by keeping their money in the bank accounts. (Pettinger,
n.d.)

Non – bank company such as insurance company is established mainly for the purpose

of providing protection against unpredictable life occurrences and the person suffering losses will
be indemnified by the insurance company (McQuerrey, 2018). As an insurance company is a for
– profit business, it must collect more money than it pays out to customers by creating an internal

business model including underwriting and investments income. The underwriting revenues come
from the insurance premiums paid by the customers, minus money paid put on claims and

business expenses. As for the investments, insurance company takes the premium paid by the
customers and invests the money in the financial markets, to increases their income (O'Connell,
n.d.).

Public Bank is one of the biggest licensed banking institutions governed by the Central
Bank of Malaysia. Public Bank has stable growth strategy and is concentrated. The services focus
on the growth of retails loan, deposits and intermediate business

(Public Bank, n.d.). Today, Public Bank brand is an outstanding customer service provider with
steady operation, strong management, good asset quality and has secured stable profitability.

AIA Insurance is an insurance company that provides inclusive insurance plans and

protection products that help individuals and business. The company provides financial help to
customers including protection, health, personal accident, mortgage, retirement and family takaful

(AIA, n.d.). AIA Insurance aims to give protection to its customers and financial security needs.
AIA Insurance has been one of the best insurance companies in the country and score index of
21.3% in 2019.

Public Bank has an exclusive bancassurance partnership with AIA (Business, 2017).
Under this bancassurance, there is a product called ‘PB Care PA’. The product is created
exclusively for Public Bank account holders and AIA will pay the benefit to the assured. This report

is written to provide information obtained through ratio analysis made on Public Bank and AIA
Insurance. The ratio analysis focuses on the profitability, liquidity, capital adequacy and asset

quality.

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