Aljazira Takaful 'in final stages of evaluating merger with Solidarity', says CEO

Aljazira Takaful Taawuni Co. is in the final stages of evaluating its potential merger with Solidarity Saudi Takaful Co., Saqr Nader Shah, CEO and MD, told Argaam, adding that the company is implementing a certain timeframe.

"We had certain targets, namely, boosting our market share and increasing profitability," Shah stated.

“Transferring the takaful portfolio of Bank Aljazira entailed a big number of retail clients, who have long-term insurance policies, which will help improve the company's revenues. The company will have more opportunities to implement cross-selling strategies, which will definitely expand its local market share, Shah added.

The CEO attributed the profit increase by 80% year-on-year (YoY) in Q1 2020 to a 143% surge in the company’s retail clientele, higher written premiums, and increased savings portfolios.

The Saudi insurer decided to withhold dividend for 2018 and 2019 to bolster its financial position, Shah explained, adding that the return on equity rose by 80%.

He also added that shareholders' equity grew to SAR 447 million in Q1 2020, and could reach SAR 500 million if it maintains the same growth rate, which will help boost expansion, growth and maximize returns for shareholders going forward.

"The COVID-19 outbreak will create new opportunities in terms of reaching out to customers. Meanwhile, protection and savings programs represent no more than 3% of Saudi insurance market. Accordingly, there is a very interesting opportunity to reach out new customers through these programs," Shah noted.

Aljazira Takaful reported a net profit before Zakat of SAR 13.4 million in Q1 2020, up by 80% YoY, Argaam earlier reported.