Finance & Capital Market

Saudi Re to hike capital with 1:10 bonus share issue

Saudi Reinsurance Company (Saudi Re), a leading reinsurance company in the Mena region, said it will increase the company’s capital through 10% bonus share distribution, granting one share for each 10 owned-shares.

Saudi Re said that the board recommended the increase of Saudi Re's capital to SR891 million ($237.6 million) from SR810 million and converting SR81 million ($21.6 million) of retained earnings into capital, through this 1-for-10 bonus share distribution.

Fahad Al-Hesni, Managing Director and CEO of Saudi Re, said: "The capital increase will strengthen Saudi Re's capital base and support the expansion plans in the domestic and international markets. The board's recommendation comes in line with Saudi Re's effort to generate better returns and create a greater shareholder value.”

Despite the unprecedented challenges that faced the reinsurance markets, 2020 financial performance marked another positive year for Saudi Re, recording SR60.7 million ($16 million) net profit before Zakat with an increase of 2% compared to 2019. At the same time the financial position remained strong as the company's total assets jumped 7% to SR2.8 billion ($0.74 billion), while shareholders’ equity grew by 5% to SR923 million ($246 million) compared to the previous year.

Saudi Re recorded a significant increase of 18% (SR935 million i.e. $249 million) in Gross Written Premium in 2020, compared to 2019 which was driven by growth in the international markets by 25% while increasing its domestic portfolio by 8%.

Saudi Re continues to sustain a well-diversified book of business with growing presence in more than 40 global markets across the Middle East, Asia, Africa, and UK-based Lloyd's, representing about 63% of the company's total portfolio. This has resulted in improved combined ratios and underwriting profitability, year on year. – TradeArabia News Service