SBC intends to double its stakes in Asian Re
Wednesday, 17 September 2008
Shakhawat Hossain
Sadharan Bima Corporation seeks to invest more US$ 1.1 million to double its stake in the emergency Asian Reinsurance Corporation (ARC), officials said Tuesday.
In a recent letter to the finance ministry, the lone state-owned general insurance company, appealed to the finance ministry to be allowed to buy 500 new shares in the ARC, popularly known as Asian Re.
At present, Sadharan Bima Corporation (SBC) has nearly 5000 shares in the Bangkok-based Asian Re, which is implementing a policy to increase its capital base to $100 million by the end of this year.
Each share will cost the SCB $2200, said the officials.
"The SBC will invest the money from its own coffer. All it needs is approval of the finance ministry," said Sadharan Bima managing director Shafiqul Islam.
Asian Re is expected to emerge as a leading reinsurance company soon to challenge the dominance of European insurers in the Asia Pacific region, he said.
Islam said many European companies operating in Asia Pacific are reluctant to expand their business due to credit crunch and lingering recession in the USA and its negative impact on the leading economies in Europe.
Aspirant Asian financial organisations want to take this opportunity to expand their business activities by injecting fresh investment.
The latest move by Asian Re to offer shares to the stake holders is part of its policy to increase its capital base, he said.
Asian Re offered shares in the past. But the SBC which is controlling about 50 per cent the country's public sector business did not show that much interest.
"But this time the situation is favourable to the SCB as additional shares will help it become an associate member in the growing multinational organisation", he said.
At present Asian Re that has been operating business in Asia Pacific region for last 25 years has 10 council members and seven associate members.
The council members are: Afghanistan, Bhutan, Bangladesh, China, India, Iran, Sri Lanka, South Korea, Thailand and the Philippines.
Islam said the SCB is getting good return from the Asian Re in recent years which is another reason for the state-owned insurance company to increase its stakes.
As of 2007, Asian Re recorded 16.9 per cent growth in premium over the previous year and its net operating profit stood at $3.16 million. Its total asset stood at 77.3 million as against $56.9 million in 2006.
Sadharan Bima Corporation seeks to invest more US$ 1.1 million to double its stake in the emergency Asian Reinsurance Corporation (ARC), officials said Tuesday.
In a recent letter to the finance ministry, the lone state-owned general insurance company, appealed to the finance ministry to be allowed to buy 500 new shares in the ARC, popularly known as Asian Re.
At present, Sadharan Bima Corporation (SBC) has nearly 5000 shares in the Bangkok-based Asian Re, which is implementing a policy to increase its capital base to $100 million by the end of this year.
Each share will cost the SCB $2200, said the officials.
"The SBC will invest the money from its own coffer. All it needs is approval of the finance ministry," said Sadharan Bima managing director Shafiqul Islam.
Asian Re is expected to emerge as a leading reinsurance company soon to challenge the dominance of European insurers in the Asia Pacific region, he said.
Islam said many European companies operating in Asia Pacific are reluctant to expand their business due to credit crunch and lingering recession in the USA and its negative impact on the leading economies in Europe.
Aspirant Asian financial organisations want to take this opportunity to expand their business activities by injecting fresh investment.
The latest move by Asian Re to offer shares to the stake holders is part of its policy to increase its capital base, he said.
Asian Re offered shares in the past. But the SBC which is controlling about 50 per cent the country's public sector business did not show that much interest.
"But this time the situation is favourable to the SCB as additional shares will help it become an associate member in the growing multinational organisation", he said.
At present Asian Re that has been operating business in Asia Pacific region for last 25 years has 10 council members and seven associate members.
The council members are: Afghanistan, Bhutan, Bangladesh, China, India, Iran, Sri Lanka, South Korea, Thailand and the Philippines.
Islam said the SCB is getting good return from the Asian Re in recent years which is another reason for the state-owned insurance company to increase its stakes.
As of 2007, Asian Re recorded 16.9 per cent growth in premium over the previous year and its net operating profit stood at $3.16 million. Its total asset stood at 77.3 million as against $56.9 million in 2006.