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Hanwha General Insurance to up equity capital by $191 million via new issues

2017.09.08 16:38:44 | 2017.09.08 16:41:25
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South Korea’s Hanwha General Insurance Co. will seek to recapitalize by 215.28 billion won ($191.2 million) through rights offering to meet capital requirement under new global accounting rule.

Hanwha General Insurance on Friday held a board of directors meeting and approved to offer rights in 215.28 billion won worth in new issues. The new issues of 26 million new shares will be tantamount to 28.7 percent of current outstanding shares. They will be offered to existing shareholders at 8,280 won apiece -discounted 5.8 percent from Thursday’s closing price of 8,790 won.

Existing shareholders can choose to exercise their right to buy the new shares on Nov. 1-2. Underwriters Mirae Asset Daewoo Securities Co. and KB Securities Co. will offer unsold issues to retail investors on Nov. 6-7.

Hanwha General Insurance is issuing the new shares to improve its international credit standing and prepare for the new global accounting and insurance capital standards.

From 2021, local insurers will be under a new accounting rule that evaluates liabilities based on market value. Also, a new insurance capital standard, which is an enhanced regulation that supervises risk-based capital ratio, will be confirmed in 2019 and enforced in 2021. Risk-based capital measures an insurer’s ability to pay back to policymakers. The higher the ratio the more financially stable the insurer is.

The RBC ratio of Hanwha General Insurance was 153.11 percent as of end of last year before reaching 168.07 percent as of end of June this year, hovering below rivals like Meritz Fire & Marine Insurance Co. whose figure stands at 203.84 percent.

Industry sources note that the planned capital increase will help raise ratio of risk-based capital of Hanwha General Insurance to about 200 percent.

Hanwha General Insurance, meanwhile, posted a net profit of 93.8 billion won in the first half of this year, up 55.8 percent from the same period a year ago.

By Park Joon-hyung

[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]



  • Seoul Sun 22 July 2018
  • SUN


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