February 20 (SeeNews) - Eurohold Bulgaria [BUL:EUBG] said that it took further steps to guarantee the solvency of its subsidiary Euroins Romania so as to shield it from what it describes as "regulatory overpressure".
Euroins Romania signed a quota share reinsurance agreement with EIG Re, the reinsurance arm of Euroins Insurance Group (EIG), thus addressing all remarks made by the Romanian insurance supervision authority, Eurohold Bulgaria said in a statement on Friday. EIG is a Eurohold subsidiary and the owner of Euroins Romania.
The deal provides a higher coverage of Euroins Romania's minimum capital requirement and solvency capital requirement - the two key indicators of an insurer's stability and solvency, Eurohold said.
It covers the full amount of insurance claims of the Romanian company and resolves all outstanding issues constituting the dispute with the insurance supervisory authority in Romania, the group added.
The move comes after earlier last week Eurohold said that Euroins Romania is the target of a hostile takeover attempt.
The Romanian financial regulator, ASF, has declined comment.
"[...] despite the signed new quota share reinsurance contract, the efforts defending the validity of the previous reinsurance contracts, contested by officials of the insurance supervision in Romania, will continue. The request for an independent international audit of the state of Euroins Romania before and after these additional measures remains as well," Eurohold said.
The Bulgarian group noted that Euroins Romania is in "excellent financial state," regularly and timely servicing its obligations to clients. Eurohold expects its Romanian unit to retain a leading position on the local market, where it held a 31% market share as of September, according to ASF data.
In early February, ASF approved the acquisition of a minority stake in Euroins Romania parent EIG by the European Bank for Reconstruction and Development (EBRD). The deal was already given the green light by Bulgaria's Financial Supervision Commission at the end of 2022, following a detailed and complete audit of the financial position of the insurance group and its subsidiaries, including Euroins Romania.
Eurohold Bulgaria is a leading energy and financial services group active in Central, Eastern and Southeastern Europe. It is listed on the Bulgarian and Warsaw Stock Exchange. EIG provides a full range of insurance products, serves over 4 million customers in 11 countries and has over 3,000 employees.
Eurohold lost over 8% of stock value over the past week, Sofia bourse data showed. Shares in Eurohold closed flat at 1.60 levs ($0.87/0.81 euro) on Friday.
(1 euro = 1.95583 levs)
Euroins Romania Asigurare Reasigurare SA is among the biggest insurers in SEE, for more reference take a look at
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