MEDGULF says may miss SAMA deadline on solvency requirements

Mediterranean and Gulf Insurance and Reinsurance Co. (MEDGULF) said it might not be able to comply with the required solvency margin by the Dec. 31, 2017 deadline set by Saudi Arabian Monetary Authority (SAMA).

The company added that it has taken corrective measures, following SAMA’s final warning to meet the solvency requirements within the deadline.

As part of the corrective measures, MEDGULF has appointed a financial advisor to set up a corrective plan, and held a number of board meetings to discuss the proposed plan.

The board of directors plans to schedule another meeting shortly to approve the corrective plan, before submitting it to SAMA, the company said in a statement on Tadawul.

The insurer noted that SAMA’s warning was final and if the deadline was not met, the Saudi central bank will ban MEDGULF from issuing or renewing insurance policies.

MEDGULF added that cutting accumulated losses to 19.5 percent as of September 30, 2017, through a capital reduction and collection of doubtful debts does not have an impact on improving the company’s solvency.

In October, SAMA had told the insurer to meet a number of solvency requirements by Dec. 31, 2017, Argaam reported.

 MEDGULF is also required to submit relevant financial reports for Q4 2017 by January 18, 2018.