Saudi Insurance Companies Gain USD349 Million in Nine Months

Saudi Insurance Companies Gain USD349 Million in Nine Months
TT

Saudi Insurance Companies Gain USD349 Million in Nine Months

Saudi Insurance Companies Gain USD349 Million in Nine Months

Insurance companies listed in Saudi domestic stock market earned additional profits worth SAR1.13 billion (USD349.3 million) during the first nine months of 2017. Twenty-three listed companies witnessed an increase in profits, six others witnessed a fall in profits, and four firms suffered losses.

The 23 companies, whose profits grew in the past nine months, represent 69.7 percent of the total listed companies in the insurance sector in the Saudi capital market. This reflects the remarkable growth in the kingdom's insurance market, the fact that indicates that Saudi Arabia is heading towards motivating and organizing the insurance sector to fulfill its vital role in diversifying the economy.

These positive developments coincide with launching Saudi plans to provide more vacancies to nationals in the insurance sector.

According to information obtained by Asharq Al-Awsat, companies operating in the insurance sector will submit monthly details of vacancies nationalized to Saudi Arabian Monetary Authority (SAMA), given that SAMA tends to apply nationalization to companies operating in all sectors and companies of all sizes.

Based on this information, the insurance sector ended Thursday’s trading with a drop of 1.46 percent.

In a related matter, SAMA noted on Friday that its decision to exempt listed firms from disclosing initial financial lists of the fourth quarter of the current year will grant listed companies the right to disclose results or not -- it won't be compulsory.

“The decision serves the authority's continuous quest to develop the capital market in the kingdom out of keenness to go along with uninterrupted changes in global markets and to apply the best international standards and practices,” stated SAMA.

The financial sector development program in Saudi Arabia works on boosting development of capital market, enhancing experience of operators and users as well as the position of these markets on the regional level in which the Saudi capital market becomes a key one in the Middle East.

These updates come at a time when the Saudi insurance company has become one of the basic investment pillars depended on by investors in the capital market.



Urgent Financial Tasks Await Lebanon’s Emerging Government

Lebanese President Joseph Aoun stands between Speaker of Parliament Nabih Berri and caretaker Prime Minister Najib Mikati (dpa)
Lebanese President Joseph Aoun stands between Speaker of Parliament Nabih Berri and caretaker Prime Minister Najib Mikati (dpa)
TT

Urgent Financial Tasks Await Lebanon’s Emerging Government

Lebanese President Joseph Aoun stands between Speaker of Parliament Nabih Berri and caretaker Prime Minister Najib Mikati (dpa)
Lebanese President Joseph Aoun stands between Speaker of Parliament Nabih Berri and caretaker Prime Minister Najib Mikati (dpa)

A broad internal consensus, encompassing both political and economic dimensions, is taking shape to adopt the principles outlined in the presidential inauguration address as the foundation of the new government’s program and ministerial statement. This approach aims to sustain Lebanon’s immediate and strong positive momentum, which is reinforced by widespread support on both Arab and international levels.

Economic bodies and professional unions representing business sectors have openly expressed their relief and full support for the strategic directions set by President Joseph Aoun following his election. However, they have made it clear that maintaining this positive momentum depends on the formation of a reform-oriented rescue government, composed of competent, experienced, and honest ministers. This government must also collaborate constructively with the president.

According to a senior financial official, the rescue mission will be challenging due to years of governmental inaction and constitutional voids, which led to a deterioration in public sector operations and the accumulation of economic, financial, and monetary crises over the past five years. These challenges were further compounded by a devastating war, which inflicted severe human and financial losses estimated at approximately $10 billion, thereby worsening the country’s financial gap, now estimated at $72 billion.

Economic and banking circles are looking to the new government to swiftly capitalize on extensive international support by restoring trust and reestablishing financial channels between Lebanon and its regional and international partners. Key to this effort are explicit and transparent commitments to combating illegal economic activities, corruption, smuggling, money laundering, and drug trafficking. In parallel, the government must prioritize strengthening judicial independence and implementing strict controls over land, sea, and air borders.

The national consensus evident in the presidential election, according to Mohammad Choucair, head of Lebanon’s economic associations, paves the way for constructive collaboration among political factions. This collaboration is crucial for addressing challenges, rebuilding the state, and benefiting from renewed international and Arab—particularly Gulf and Saudi—interest in Lebanon. Choucair emphasized the importance of normalizing relations with Gulf nations, supporting Lebanon’s recovery, and providing resources for reconstruction efforts.

One of the urgent tasks for the new government, according to the financial official, is revisiting the draft 2024 state budget, which was previously submitted to parliament. Adjustments are necessary to address fundamental discrepancies in expenditure and revenue projections, taking into account significant changes brought about by the Israeli war.

Ibrahim Kanaan, chairman of the Parliamentary Finance Committee, described the budget as “unrealistic, if not entirely fictitious,” particularly in its revenue estimates. He pointed out that revenue increases were based on income and capital taxes, internal duties, and trade-related fees, all of which have been severely impacted by the war.

Reassuring depositors, both domestic and expatriate, who have suffered massive losses over recent years, is another pressing issue. These losses were exacerbated by the inability of successive governments to implement a comprehensive rescue plan addressing the $72 billion financial gap fairly. The situation was worsened by mismanagement in the electricity sector and the squandering of over $20 billion in central bank reserves following the onset of the financial crisis.

In response to Aoun’s commitment to a fair resolution for depositors, the Association of Banks in Lebanon welcomed his emphasis on safeguarding deposits. It also expressed its readiness to collaborate with the central bank and the government to protect depositors’ rights, citing a recent State Council ruling that prohibits any financial recovery plans from including measures that would erode depositors’ funds.

In its final session, the caretaker government addressed long-standing creditor issues by unanimously agreeing to suspend Lebanon’s right to invoke statutes of limitations on claims by foreign bondholders under New York law. This suspension, effective until March 9, 2028, aims to facilitate future negotiations.

With this decision, the caretaker government tacitly acknowledged Lebanon’s pending debt obligations, including over $10 billion in suspended interest payments on Eurobonds and approximately $30 billion in principal debt. The resolution now awaits direct negotiations under the new administration, which faces the challenge of resolving a nearly five-year-old crisis triggered by the previous government’s uncoordinated decision to halt payments on all Eurobond obligations through 2037.

Caretaker Finance Minister Youssef Khalil emphasized that despite the difficult circumstances, “Lebanon remains committed to reaching a fair and consensual resolution regarding the restructuring of Eurobond debt.”