1- 2006 Business Issues
The 2006 business year was a remarkable year in the company’s history and we are proud to report positive performance indicators during a most unusual year that witnessed a wide scale war, internal political instability and continuing economic strains.
The relentless and coordinated efforts of the staff and management team of AL MASHREK insurance and reinsurance SAL have produced the following:
a) Global Performance Indicators:
Licensing
"AL MASHREK" maintains the widest insurance company branch licensing in Lebanon (Life, Property, Marine, Accident & Credit) for the benefit of its Business Providers and Clients
15% increase in Paid up capital
the total paid up capital was LBP 5.75 billion at 2006 year end
9% increase in Shareholders Equity
Total shareholders equity at 2006 year end amounted to LBP 11.43 billion
2% increase in Total Assets
Total Assets recorded in the Balance sheet as at 2006 year end were 35.71 billion
5% increase in Provisions & Reserves
the total Provisions & Reserves carried at 2006 year end were 12.56 billion exceeding 50% of the 2006 written premiums
7% decrease in Liabilities
total liabilities at 2006 year end were LBP 11.8 billion, that is around 33% of Total Assets
9% increase in Written Premiums
the Written Premiums during the year 2006 were LBP 24.18 billion
16% decrease in Acquisition costs
known to include a relatively large number of fiercely competing insurance companies, AL MASHREK increased its sales volume in 2006 while significantly reducing the aggregate commissions and discounts granted
5% decrease Expenses
AL MASHREK was successful in decreasing the aggregate expenses incurred during the year 2006 without discarding fundamental operational requirement
13% increase in Claims Incurred
the aggregate amount of claims incurred and allocated to the year 2006 amounted to LBP 9 billion, averaging LBP 30 million per working day
Positive Net Profit
subsequent to the regulatory requirement for significant increase in the types and amounts of technical provisions for the entire Lebanese insurance market starting the year 2004, the company has regained its ability to generate a positive net result for the year 2006 which amounted to LBP 0.69 billion
Solvency Ratio
10.67%
Return on Equity (ROE)
6%
2- Future Outlook
Guided by our corporate Vision, AL MASHREK remains committed to provide its Customers with most efficient quality of service. Within this tradition the company will be reviewing its internal Processes with an aim of upgrading its work procedures to ensure highest standards of customer satisfaction. In this sense, the company is ISO 9001-2000 certified since November 2007 for the "Design & Provision of Insurance Services".
“AL MASHREK” strategy seeks to expand operations in Lebanon and in other potentially profitable jurisdictions.
On the Local scene, the company will be working to increase its sales by promoting:
1. its Client and Business Providers relations
2. its Life insurance resources
The Management has concluded in 2007 an Agency agreement with Fortis Investments as being among the top 25 financial institutions worldwide in order to promote the Life Investment and Unit Linked Product sales.
On the territorial level, AL MASHERK has been seeking to make best use from its comparative advantage as being among the oldest private insurance companies in the Arab region that are accustomed to operate within a jurisdiction open to international competition.
The company’s management has established Egypt and the Kingdom of Saudi Arabia as being most promising for which reason they have been regarded on the top of the expansion priority list.
During the year 2007, partial acquisition of the Egyptian insurance company, Royal and Sun Alliance, has been realized with active management control being delegated to “AL MASHREK”
Extensive work is continuing to transform the Saudi setup into a fully licensed Saudi company with SAR 150 million capitalizations. As the SAMA licensing is obtained (anticipated during 2008), AL MASHREK will also execute the management of the Saudi company and will be among the principal shareholders
