Share of foreign capital in Russian insurers rises to 22% in 2010
MOSCOW. Feb 16 (Interfax) - The share of foreign capital in the total capital of Russian insurance companies rose to 22% in 2010, up from 16.1% in 2009 and 13.5% in 2008, the Federal Insurance Service department head Tatyana Mayorova told journalists.
Of the total, 11.9% is the outright equity stakes held by foreign companies and 10.3% is indirect participation by foreign capital, she said.
Shareholders from Austria accounted for 35% of the foreign presence, followed by the Netherlands (24%), Cyprus (19%) and Germany (6%), the UK (5%), France (3%), Belgium (2%) and Bulgaria (1%).
Meanwhile, the head of the Federal Insurance Service, Alexander Koval, said Russian insurance companies would need an extra 54 billion rubles by the end of 2011 to meet capital requirements.
More than 70% of Russian insurers (450 companies) do not currently meet the new capital requirements scheduled to take effect in 2012, Koval told journalists on Wednesday.
Koval also said he was pessimistic concerning the possibility of stepped up M&A activity on the Russian market in 2011. "Our survey indicated that the market leaders are not ready for those kinds of deals. They don't want to purchase weak companies, believing that it will be much simpler to buy in-force business from troubled insurers," he said.
Despite recovery in the business insurance segment, 2011 could be much more difficult for Russian companies than 2010, he said.
"Financial difficulties might compel companies to throw discretion to the winds. The job of the supervisory is not to let that happen," he said.