Saudi Reinsurance Co. (Saudi Re), listed on the Saudi Exchange (Tadawul), announced that the board of directors, in a meeting on April 6, 2022, recommended increasing the company’s capital through a rights issue.
According to the estimates from Saudi Re stated that the SR 445.5 million (USD 118.7 million) rights issue will increase the capital from SR 891 million (USD 237.5 million) to SR 1.336 billion (USD 356 million). Accordingly, the number of shares will surge from 89.1 million to 133.65 million.
Saudi Re also added that this initiative focuses on boosting Saudi Re’s capital base and supporting its future expansion activities. The capital increase is pending approval of the Saudi Central Bank (SAMA), the Capital Market Authority (CMA), and other regulatory authorities, in addition to its extraordinary general meeting.
Furthermore, the company stated that they will announce the appointment of a financial advisor and submission of the capital increase application file in due course.
According to Saudi Re’s analysis and report compilation, In 2021, Saudi Re successfully completed a capital increase to SR 891 million (USD 237.5 million) from SR 810 million (USD 215.9 million) by capitalizing SR 81 million (USD 21.5 million) from retained earnings. The capital increase was done through a 1-for-10 bonus share distribution.
Fahad Al-Hesni, Managing Director and Chief Executive Officer, Saudi-Re stated: “Saudi Re has attained a growth rate of 19% over the past three years, as we expand our activities across more than 40 markets in the Middle East, Asia, and Lloyd’s Market in the United Kingdom and Africa.”
He stated: “Our Gross Written Premium (GWP) increased by 19.3% to SR 1.1 billion (USD 293.2 million) in 2021, marking the highest premium level achieved in the history of Saudi Re and reinforcing our status among the top-ranked Middle Eastern reinsurers.”
Al Hesni further stated: “In line with our long-term strategy towards 2026, we have set out with a clear ambition at the onset of 2021 to evolve and diversify as a company that can reliably serve the risk and growing reinsurance needs of the Kingdom, aiming to become among the top 50 global reinsurers.”
Saudi Re stated that Despite challenging market conditions the firm has maintained its track record of profitability in 2021 by registering a net profit of SR 38.3 million (USD 10.2 million), resulting in a 4.4% growth in total shareholders’ equity to SR 964 million (USD 257 million) by the end of 2021.
Saudi Re claims that it has maintained its Insurance Financial Strength Rating (IFSR) at “A3” with a stable outlook from Moody’s Investors Service (Moody’s), reflecting industry expectations for the company to maintain profitability, capital adequacy, an adequate level of reserves and strong asset quality demonstrated by its investment portfolio.
Saudi Re also stated that it is one of the biggest reinsurers in the MENA region and provides several solutions in the transfer of risks and specializes in compulsory and optional reinsurance solutions in engineering, property, marine, accidents, vehicles, life, and health sectors.
Press Release received on Mail
