The National Bank of Ukraine (NBU) has revoked the licenses of ALC IC Amji-Insurance (Kiev) and PJSC IC VONA to provide financial services due to the non-compliance of their ownership structure with the legislation. (Lviv), reported on the website of the regulator.
The decision to cancel the licenses was taken by the board of the NBU on March 2, 2023 in accordance with Article 381 of the law “On Financial Services and State Regulation of Financial Services Markets”.
The NBU informs that according to the last submitted financial statements for the year 2022 the amount of insurance premiums of the company as of December 31, 2022 was UAH 1.927 million, the value of assets – UAH 39.322 thousand, insurance reserves – UAH 270 thousand. The market share of the company on insurance premiums amounted to 0,006%.
According to the last submitted statements of IC “VONA” for 2022, the value of its assets amounted to UAH 31,098 mln. There were no insurance premiums, insurance reserves. The market share of the company on insurance premiums – 0,0%.
After the revocation of license the financial institution is deprived of the right to operate by the types of licenses withdrawn, but does not relieve the financial institution from its obligations under contracts for the provision of financial services.
IC “Amji Insurance” (until March 2019 – OTO “OTL-Insurance”) specializes in risk insurance. According to the data of the company, published on its website, as of the beginning of 2022 its shareholders were 16 individuals.
IC “VONA” (former IC Veltva) has been incorporated in October, 1995. Since 1997 it is a member of the Motor (transport) Insurance Bureau of Ukraine, the Kharkov Union of Insurers, “Insurance business” association and the Kharkov Chamber of Commerce and Industry.
In October 2013 IC “VELTA” has rebranded to PrJSC “Insurance company “WONA” and changed its location to Lvov.
According to the website of the insurer, its shareholder on January 1, 2022 is LLC “UKR SEL” (Lviv), which owns 99.9% of the insurer. Through it, Tatiana Barbaniuk owns 13,9986% of the insurer, Yaroslav Ishchak – 41,276%, Roman Kapustin – 44,816%.
Although 2022 was a difficult year for the whole of Ukraine and for the insurance industry, it did not become a verdict – the industry survived, insurance did not disappear, insurers generally have a slight decline by 2021, and some even have a very good increase.
This was written by Vyacheslav Havrylenko, CEO of ARX Life Insurance Company, Deputy Chairman of the Board of ARX, in a column published by Interfax-Ukraine.
Risk insurance market
In numbers, in 2022, the market fell by about 11% compared to the previous year, which is very good in a time of war. If we look at the market without the Green Card, the drop will be 17%, which is also a satisfactory result. These are preliminary data based on information from members of the National Insurance Association of Ukraine.
The Green Card has become the leader in insurance, with growth of 152% (due to the massive departure of Ukrainians abroad, especially at the beginning of the war). The volume of premiums was stable, with only a slight drop of 3%. Health insurance fell by 16%. The biggest drop was in hull insurance – 20% year-on-year.
Travel insurance grew by almost 42%. Property insurance (in the corporate segment) was also a surprise – our premiums fell by only 25%, although we did not expect such a moderate drop. One of the reasons is that global insurance programs have largely disappeared and customers have turned to local insurers. The market benefited from this.
If we describe the behavior of customers, we can say that although the demand has dropped (due to financial difficulties, the inability to insure at all in parts of Ukraine, the catastrophic drop in new car sales and the drop in car loans), it has not disappeared at all – customers felt the need for insurance. Ordinary insured events have not disappeared, and insurers compensate customers for their losses. In 2022, ARX paid UAH 826 million in indemnities, and we continue to make payments under the contracts of the previous year.
Life insurance
Regarding the life market, we can state that, just like in non-life, the market withstood in 2022. At the same time, the total premiums of all life companies in general showed a 14% decrease compared to the previous year. Some companies experienced a bigger drop, but some showed a slight increase. The composition of the main players has not changed over the past year.
While overall there was a moderate drop in payment volumes, in the non-lending individual insurance segment, we even grew by 5% compared to 2021.
Corporate insurance showed an increase of 10%. As for clients, our portfolio amounted to more than 430 thousand clients in 2022. Unfortunately, this is a clear decline in the total number of clients compared to the previous year. Therefore, we are focused on retaining customers and focus on reliable and high-quality service – we take care of our partners and customers every day.
We ended last year with a profit of UAH 25 million, which is more than 2 times higher than in 2021. As for payments, we collected almost UAH 270 million, which, unfortunately, means a 16% decrease in payments in general compared to the total fees of the previous year.
But overall, we are optimistic about the future. For example, in 2022, we launched a new product called “Armor Protection”, which is accident insurance that includes military risks. So it’s definitely not time to stop.
What to expect in 2023
Regarding plans for 2023, it is clear that it is impossible to predict how the situation with the war and the economy will develop (although we are optimistic), but we must plan our activities. So we will try to achieve a year-on-year growth of 22% to 23%.
Of course, these are average figures, and they will differ for different types of insurance, sales channels and regions of Ukraine. Perhaps this is a somewhat ambitious plan, but we see it as such. We will see what happens in reality; in January we fulfilled our plan.
We do not foresee a significant increase in new car sales this year and do not forecast a significant increase in the share of car loans in these sales. Therefore, we continue to focus our sales on car insurance without loans, including used car insurance – it is clear that these will be not only full hull insurance programs. In particular, we continue to actively develop online sales and hybrid sales (transfer of online leads to sales offices and call centers). We are also actively working with cross-selling to MTPL customers, but the main resource for many companies will be the renewal and retention of their own base of existing customers.
Therefore, we will continue to focus on high quality of service, development of additional in-house services, and will prove our main advantage – true fundamental reliability.
Against the backdrop of the war, falling demand, and financial difficulties, the NBU continues its systematic and systematic work to oversee companies’ compliance with financial standards. So, all together, all insurers are pushing all insurers to work profitably (otherwise there will be a lack of capital) and form reserves with the proper assets, but at the same time constantly improve the quality of their services and not try to achieve profitability by “cutting” justified payments to customers; continue to move further into digitalization, but reduce operating costs.
Undoubtedly, some companies will leave the market due to the factors described above, but almost all large companies with Ukrainian capital and all international companies will remain in the market. In general, customers will benefit because the reliability of insurers and the quality of their services are increasing.
The U.S. dollar is getting cheaper against the euro, the yen and the pound sterling in trading on Friday after a strong strengthening at the end of the previous session.
The ICE-calculated index showing the dollar’s dynamics against six currencies (euro, Swiss franc, yen, Canadian dollar, pound sterling and the Swedish krona) lost 0.21% in trading, while the broader WSJ Dollar Index lost 0.2%.
The euro/dollar pair is trading at $1.0616 as of 8:20 a.m., up from $1.0597 at market close Thursday.
The pound/dollar exchange rate rose to $1.1977 from $1.1947 the day before.
The value of the U.S. currency in a pair with the yen dropped to 136.46 yen from 136.77 yen at closing of the previous session.
On Thursday the dollar gained 0.7% against the euro and the pound and 0.4% against the yen. Signals of a resilient U.S. labor market confirmed investors’ belief that the Federal Reserve (Fed) may raise the benchmark interest rate higher than previously planned.
However, statements from Atlanta Federal Reserve Bank (Fed) President Rafael Bostick, in which traders saw dovish signals, calmed the market somewhat.
Bostick, who does not have a vote on the Federal Open Market Committee (FOMC) in 2023, said during a press briefing Thursday that he would support a 25 basis point (bps) increase in the Fed’s benchmark interest rate at the March meeting. He noted that the U.S. central bank, in his view, should proceed cautiously, given the pent-up effect of policy tightening that could manifest itself soon.
When asked when the Fed stops the cycle of raising the rate, Bostic said that the appropriate situation for this may occur by mid-end of the summer of this year, Bloomberg reported.
Fed Board of Governors member Christopher Waller said Thursday that if the next batch of statistics on the U.S. economy shows slowing inflation and some weakening of the labor market, he would be willing to support “a couple more hikes” of the Fed rate – to a maximum of 5.1-5.4 percent from the current 4.5-4.75 percent.
“However, if this data continues to show that U.S. economic activity remains too ‘hot,’ we will need to raise the rate above that level to be sure that the momentum for easing inflation is not lost,” Waller said.
In Ukraine on Saturday, March 4, predominantly without precipitation, only in the daytime in the northern part of the country in places a little rain and wet snow, reports Ukrhydrometecenter.
Wind is western, southwestern, 7-12 m/sec. During the day across Ukraine, except in the south, gusts of 15-20 m/sec.
The temperature at night is from 2°C to 3°C frost, in the Carpathians – 2-7°C; during the day – 3-8°C, in the south of the country – 6-11°C.
March 4, no precipitation in Kiev. Wind is westerly, 7-12 m/s, during the day gusts of 15-18 m/s. The temperature at night is near 0°C, while during the day it may be 4-6°C.
According to the Central Geophysical Observatory of Boris Sreznevsky in Kiev since the beginning of meteorological observations the highest temperature of March 4 was +16.1 ° C in 1995, the lowest at night -21.1 ° C in 1987.
Sunday, March 5, at night in the western and northern regions, in the afternoon in the south-east of Ukraine and the Carpathians, little wet snow and rain is expected, while the rest of the territory is precipitation-free.
The wind is westerly, 7-12 m/s. The temperature at night is 1-6°, in the Carpathians up to 8° frost, in the southern and eastern regions 0-3° heat; during the day in Ukraine 1-6° heat, in the south up to 10°.
March 5 in Kiev, there is light wet snow and rain at night, while during the day there is no precipitation. The wind is westerly, 7-12 m/s. The temperature at night is 2-4° frost, during the day 2-4° warm.
Companies are increasingly refusing to list in London in favor of the New York Stock Exchange, and this trend may continue, Bloomberg writes with reference to the opinion of analysts.
“If London fails to regain its status as a leading financial center, the trend away from London, mainly to New York, is likely to continue,” says Freshfields Bruckhaus Deringer LLP partner Oliver Lazenby.
Just this week, two major companies, construction materials manufacturer CRH Plc and IT firm Arm Ltd. opted to list in New York.
Meanwhile, bookmaker Flutter Entertainment Plc and biopharmaceutical Indivior Plc are planning secondary listings in the U.S.
Even some companies in the FTSE 100 Index are considering moving their listings to New York, said sources who wished to remain anonymous.
According to Citigroup’s Paddy Evans, U.S. exchanges attract companies with access to a larger capital market, higher valuations and less control over top executive compensation.
The capitalization of the British stock market now stands at about $3 trillion, compared with a peak of $4.3 trillion in 2007. Meanwhile, the combined market value of U.S.-listed companies has more than doubled over the same period, to $43 trillion, according to Bloomberg estimates.
The first long-term blood storage bank in Ukraine has been opened on the basis of the Kyiv City Blood Center in Kyiv within the framework of the Bold Blood project, which allows freezing and preserving rare blood types for up to 30 years.
According to a press release of the project, the center will also allow for operational logistics under the most difficult conditions, including at the scene of hostilities to rescue the injured military and civilians.
According to the acting director of the city blood center, Vitaliy Demsky, previously such important blood components as erythrocytes could be stored for a maximum of 42 days, the new blood bank will extend the life of erythrocytes up to 30 years.
“Today, we have new special equipment that can store red blood cells at temperatures from -80°C and below, and also allows freezing and thawing blood components,” Demsky said.
The project was implemented in partnership with the Ministry of Health, PariMatch Ukraine and Kyiv City State Administration.
