City Insurance, on the verge of recovering procedures imposed by the Authority for Financial Surveillance
City Insurance, the forth RCA insurer in 2015 is expecting financial recovery since the Authority for Financial Surveillance (ASF) conducted a sudden control between November 2015 and February 2016, and it turned out the company needs over 34 million EUR in order to have a minimum solvability margin.
As it appears, City Insurance has not underlayed correctly the claims backup when it comes to the Green Card policies.
After actuating the financial recovery, a financial auditor will be assigned, and all the damage claims will be inventoried until late March. Also, City Insurance will be obliged to recover several loans granted to affiliated companies, and it will not be able to grant new ones.
It turns out, the insurer has to recover claims worth over 8 million EUR from Unity Real Estate SRL, and Unity Broker de Asigurare SRL, a litigating amount, according to the Ministry of Justice.
In the company's 2014 report, there were over 10 mil EUR to recover from several debtors, with deadline on 31st of December 2014. "Based on the information available on that date, we could not estimare if there's a risk for these debts not to be recovered. Thus, we could not determine whether the adjustment of the numbers in the financial situations for claims at 31.12.2014", they explain.
The strong dynamics of subscriptions within and out of Romania, especially on RCA led to losses for the first time in 6 years. More exactly, approx. 3 million EUR in 2014.
The operation will be accompanied by the issuance of 15 million shares that will be subscribed by shareholders until 31st July.
