Saudi Indian Company for Cooperative Insurance (Wafa) announced that based on unaudited financial results of Q1 2018, accumulated losses have exceeded 50 percent of capital.
The losses stand at about SAR 70.12 million, or 57.58 percent of the firm’s capital of SAR 122 million.
The insurer attributed the losses to low sales and a sharp increase in operating expenses.
Wafa will be subject to Capital Market Authority (CMA) regulations regarding companies with accumulated losses exceeding 20 percent of capital.
The insurer’s board of director will schedule an extraordinary general assembly before June 20 to address its accumulated losses.
If the extraordinary general assembly fails to convene before June 20 or fails to make a decision to resolve the matter, the company shall be dissolved by law, according to Saudi insurance regulations.
The insurer’s board of directors had recommended an 18.03 percent capital reduction, to SAR 100 million, with the aim to offset accumulated losses, Argaam previously reported.
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