Arig posts $21m profit for 2010
Manama, February 14, 2011
Arab Insurance Group (Arig), a leading Bahrain insurance firm, posted $20.8 million in profits for the 2010 financial year, almost matching its 2009 performance, posting .
It earned $21.9 million in 2009. Both reinsurance and investments contributed to the positive bottom line with a technical result of $16.2 million ($16.5 million in 2009) and investment returns of $34 million ($33.7 million in 2009), all before consideration of expenses.
The net profit for the fourth quarter of 2010 was $9.2 million. It was $4.9 million in the fourth quarter of 2009.
Arig's non-life reinsurance portfolio performed at a 67.8 per cent loss ratio (67.9 per cent in 2009), bucking the trend of the decline in trading terms.
However, prevailing soft market conditions meant that the group had to sacrifice some premium related to under-performing accounts in order to safeguard its profitability.
Gross written premium reduced by 14.3 per cent to $239.5 million ($279.4 million in 2009).
Amid volatile financial markets and generally depressed yields on fixed term deposits, the group achieved a 5.2 per cent return on investments (5 per cent in 2009).
"Our primary concern is for our stakeholders," Arig chief executive Yassir Albaharna said. "We strongly believe that the ability of a reinsurer to produce profits across market cycles is defined by its ability to contract when conditions start becoming unattractive.
"The group is concentrating on building new opportunities for future development. During the year we expanded our regional network and established Arig as a corporate member at Lloyd's."
Arig's board of directors has recommended a cash dividend of 7.5 per cent on the company's paid-up capital, or 7.5 cents per share.
The dividend remains subject to clearance by the Central Bank of Bahrain and shareholders' approval at the company's annual general meeting on March 27.
Arig's Shareholders' equity stood at $260.1 million ($267.3 million at the end of 2009) with a book value per share of $1.31 ($1.27 at the end of 2009). – TradeArabia News Service