Wednesday May 14, 03:12 PM
Arab Insurance Q1 net profit dips due to volatility in global financial markets
LONDON (Thomson Financial) - Arab Insurance Group said its net profit for the first quarter ended March 31, 2008 declined to $2.96 million compared with $7.64 million a year earlier due to the volatility in global financial markets.
During the period, investment income declined to $3.19 million from $9 million earlier, the insurance provider said.
However, the company said the performance of its core reinsurance business was better than expected but the volatility of the global financial markets during the first months of the year depressed investment income.
The company's reinsurance portfolio grew by 41 percent year-on-year, with a gross written premium at $130.7 million compared with $93.0 million a year earlier.
The company said the impact of the decline in global financial markets was contained by its lower allocation to equities and the stop loss protection it has in place, coupled with increased earnings from cash and short-term maturities as it maintained higher cash positions during the turbulent quarter.
The company said it has no exposure to the U.S. sub-prime property market.
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