MADRID, 2 Dic. (EUROPA PRESS) –
The Mapfre RE board of directors has agreed a capital increase worth 250 million euros to boost its growth, as reported by the insurance company.
Specifically, the purpose of this operation is to reinforce the strength of Mapfre RE’s balance sheet in order to be able to offer greater reinsurance capacity to its clients in the market and provide it with greater flexibility to structure its own protection coverage, thus optimizing, as the firm explains, its underwriting risk at a time when there is a huge demand for coverage at rising prices.
The contribution of the funds will be made with internal resources from Mapfre, coming from surpluses derived from the recent exits from bancassurance agreements.
With this movement, Mapfre improves the group’s capital allocation, allowing the units with the greatest potential to grow, as is currently the case in the reinsurance market, which will result, as it has been highlighted, in an improvement in profitability.
“We are going to have more capacity to provide coverage to our customers at a time when the presence of solvent operators with a vocation for long-term service is required, which will allow us to grow at a time of improvement in technical conditions in this market, and maintaining our traditional prudent management of the business” explained the CEO of Mapfre RE, Eduardo Pérez de Lema.
Mapfre’s reinsurance unit is currently the second largest contributor to Group profit, behind Mapfre Spain. In the last fifteen years, Mapfre RE has contributed to the Mapfre Group an accumulated result after taxes of more than 1,700 million euros.
In the same period, it has recorded an average ROE of close to 11% and an average net combined ratio of 96%, despite including years of high catastrophic claims for the reinsurance sector.
Once the subscription period for the new shares has ended, Mapfre estimates that its shareholding in Mapfre RE will increase to 94.43%.
