Bahrain: At the close of the second quarter of its 2016 Financial Year, Arig returned US$ 1.8 million of net profit to its shareholders, a reduction of 71% year-on-year (half-year 2015: US$ 6.2 million). Despite the 10.8% growth of its Gross Premium Income, unsatisfactory insurance pricing, lower investment income and the impact of large losses from regional clients combined in lowering the company’s mid-year result.
The Group’s net result for the second quarter alone was US$ 1.0 million (Q2 2015: US$ 2.7 million).
Half-year premium growth originated from Arig’s involvement in the Lloyd’s market while losses from the GCC markets impacted underwriting returns. The Group’s parent returned a Technical Result of US$ 3.8 million from its underwriting activities after the first two quarters (half-year 2015: US$ 9.1 million), whereas its Takaful subsidiary, currently in run-off, showed a small profit of US$ 0.2 million for the same period (half-year 2015: US$ 0.7 million).
The Group’s combined loss ratio for the first two quarters of the year moved to 69% (half-year 2015: 67.2%) yet its combined ratio improved to 87.2% (half-year 2015: 90.2%) on savings achieved from its operations.
Investment income after the first six months accounted for US$ 9.9 million (half-year 2015: US$ 13.3 million), representing an average return of 2.7% (half-year 2015: 3.7%) on the Group’s investible assets.
Yassir Albaharna, CEO of Arig, commented: “These are challenging times for our industry, especially regional reinsurers. We see some positive signs as regulators have started to focus on sustainable market practices. But we still have a long way to go and the global policy of cheap capital is not helping us.”
Arig’s shareholders’ equity stood at US$ 251.7 million on 30 June 2016 (end of 2015: US$ 244.2 million). Book value per share was US$ 1.27 at the end of the second financial quarter 2016 (end of 2015: US$ 1.23).
Arig is one of the largest Arab-owned, professional reinsurance providers in the Middle East and Africa. The Group is listed on the stock exchanges in Bahrain and Dubai and offers a wide range of reinsurance products and services. Arig’s subsidiaries include Takaful Re (Dubai) – currently in run-off, Gulf Warranties (Bahrain) and Arig Capital Ltd. (UK). Additional information about Arig can be obtained at www.arig.net
Arab Insurance Group (B.S.C.) is a reinsurance firm regulated by the Central Bank of Bahrain.
For further information, please contact Amel Dardour, Corporate Communications, Tel: +973 17 544 357, Fax: +973 17 531 155, or email: email@example.com