Insurance, bank deposits boost Malaysia's economy

The net financial assets per capita of Malaysians stood at EUR9,430, said Allianz.

In 2023, Malaysia saw robust growth in gross financial assets, rising by 5.8%, signalling a recovery from the setbacks of the previous two years. The insurance and pensions sector, which represents 42% of the total asset portfolio, was the main driver of this growth, increasing by 9.8%, its fastest rate in five years. 

The net financial assets per capita of Malaysians stood at $10,521 (EUR9,430), placing the country in a mid-ranking position both regionally and globally, according to Allianz’s Global Wealth Report. 

Bank deposits also posted solid growth, increasing by 5.2%. However, the securities asset class lagged, with only a marginal increase of 0.3%, though it returned to positive growth after two years of contraction.

In real terms, the growth was more modest. After adjusting for inflation, the increase in financial assets in 2023 dropped to 3.2%. Real financial assets are only slightly higher than in 2020, at 0.8%, but remain 9.1% above pre-pandemic levels.

On the liabilities side, debt growth remained steady at 5.7%, keeping Malaysia's debt ratio at 81% by the end of 2023. While this is one of the highest debt ratios in Asia, it is still below the pre-pandemic levels, where the ratio hovered around 85%.