Sanad Insurance seeks regulatory approval for SAR 200 mln rights issue

Sanad Cooperative Insurance and Reinsurance Company said on Wednesday that it has submitted a request to the Saudi Arabian Monetary Agency (SAMA), the kingdom’s central bank, to raise its capital by SAR 200 million through rights issue.

The insurer’s accumulated losses reached SAR 162.2 million, or 81.11 percent of its capital by the end of April.

Saudi-based insurers, such as Wafa, AICC, United Assurance, and Al-Alamaiya have recently raised their capitals through rights issues in an attempt to offset accumulated losses, according to data compiled by Argaam.

MetLife Insurance is also working to meet SAMA’s capital raise requirements as it prepares for a SAR 175 million rights issue.

The crowded insurance sector in the kingdom has come under pressure in recent years due to low penetration rates and higher medical costs, which has made it more difficult for smaller companies to defend their market share.