Chief Minister of Sabah, Malaysia, Musa Aman has cited the case of Progressive Insurance’s successful turnaround as evidence that replacing top executives of several state-owned firms is effective in arresting financial losses incurred.
In a meeting of the Sabah State Legislative Assembly, Musa said that state-owned insurer Progressive Insurance had been losing money for several years, with the government having to intervene and pay employee’s salaries just to keep the company afloat.
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However, after its chairman, board of directors, and chief executive were all fired and replaced, the company was able to turn its fortunes around and return to profitability.
“It is now paying MYR7 million (US$1.58 million) in dividends to the state every year,” Musa, speaking to the Assembly, was quoted as saying by
Free Malaysia Today.
Assistant Finance Minister Ramlee Marhaban added that 15 state-owned companies were able to bring in a total of MYR286 million (US$64.6 million) in profits to the state government last year. These include government investment arm Warisan Harta Sabah Sdn Bhd, Sabah Development Bank, Sabah Energy Corporation, and Sabah Credit Corporation.
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