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XPRIMM News - THE ROMANIAN INSURANCE MARKET NEWSLETTER
No. 157, June 3rd, 2010
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EDITORIAL


Times are a-changin'

One year after the global financial crisis has begun, insurers and reinsurers alike are looking ahead to new times. This was the opening of my previous editorial, written in preparation of Baden-Baden 2009. More than half a year past and the groom economical situation has heavily impacted on the markets.
Nearly all CEE insurers and brokers were affected by the economical crisis.

Investors had to restructure their businesses or even to pull the plug in some cases, as can be seen in the comprehensive CEE Markets Survey put together by my colleagues.

The conclusion: no more double-digits growth rates in the region, at least for the following years. Surviving is now the key word, while flexibility becomes the main advantage.
How will the renewal season be affected by all this: difficult to predict that is.

Despite the economic downturn, large European reinsurance companies showed positive results in 2009, helped by a conservative underwriting strategy and by the low nat cat activity. Which unfortunately isn't the case anymore in
2010, a hurricane-prone year, according to experts.

The fog will disappear in the fall, when The Baden-Baden XPRIMM Symposium 2010, probably the first event dedicated to both CEE & CIS markets, will continue the tradition started back in 2009.

October 24th's the date!

by alexandru.ciuncan@mxp.ro

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INTERVIEW


Interview with Angela TONCESCU
President
Insurance Supervisory Commission (ISC)

XPRIMM: How would you draw up a balance sheet of the Romanian insurance industry in 2009?
Angela TONCESCU:
The evolution registered by gross written premiums by the entire insurance market in 2009 met ISC expectations. General insurance increased slightly, despite the difficult economic context. I would characterise it as a success given the declines registered by car sales, the leasing and real estate markets, and enterprises in other economic sectors.
The Life insurance segment felt the financial crisis most acutely, given rising unemployment and the lower income of consumers of insurance products. One of the elements that had a major influence on this sector was the psychological factor, because fear and uncertainty regarding the financial security of consumers led, in the first part of 2009, to both an increase in of the number of contract surrenders and the postponement of an intention to buy an insurance policy.
The first signs of a revival of the Life insurance segment were felt in the last quarter of last year when the premature termination of contracts diminished significantly.

XPRIMM: Can we talk about a maturing of the market given the difficult economic conditions it has had to face lately?
A.T.:
To talk about a maturing of the Romanian insurance market we should have to notice a maturing of the financial behaviour of the population. The evolution of the insurance market in 2009 demonstrated that long-term savings products, such as Life insurance, lost ground to short-term bank deposits. There was a change in the financial behaviour of Romanians that was insufficiently sophisticated even before the crisis began. Similarly, if we look at the structure of written premiums, we see that Motor lines - Motor Hull and MTPL - still account for the major share of total gross written premiums. We cannot yet talk about a maturing of the segments that should really matter - Life insurance, Health insurance and Household insurance.
However, if we consider the economic context, then we should mention that this industry has made strenuous efforts, both at the Commission and company level, to identify and apply best practice to counteract the effects of the crisis. Certainly, we all had to respond almost spontaneously, but very cautiously, to the challenges of this period, so that at the level of insurance product consumers the affects will weaken. Somehow, the financial crisis has encouraged a more responsible behaviour by companies, and here I refer not only to the insurance industry. And that is because the economic environment was the same for all industries.
When we compare insurance with other financial markets, for example leasing which lost over 75% of its business volume in 2009, we can say that the insurance industry had a satisfactory development last year.
Yes, the insurance industry's efforts should focus further on increasing an awareness about the concept of insurance. I would say that insufficient knowledge of this market among its potential customers is the main obstacle to the development of the insurance industry.
Regarding the management of insurance companies, I think they understand that the market has reached a maturity and that they should not run after market share anymore, but should manage their portfolio in a more profitable way.

XPRIMM: How did the Insurance Supervisory Commission get involved during this period in managing the financial crisis? Did it start initiatives, did it offer advice to insurance companies to deal with the problems?
A.T.:
It was a year in which the Commission got more involved in all the problems of insurance companies. Throughout 2009 we tried to meet with the management of the companies more often to discuss all their problems, to see how they could be solved for the market to develop normally and smoothly. All the steps that the Supervisory Commission took last year (including reducing taxes paid by insurance companies and brokers) were for their support, and for the support of the insurance market and the consumer. I believe this support from the Supervisory Commission contributed to the fact that insurance companies came through the crisis more easily than others.

XPRIMM: Which new trends will put their mark on the development of the insurance market this year, after a crisis year dominated by restructuring and rethinking of strategies?
A.T.:
I think this year will be a year of rethinking strategies. The financial crisis is still having an affect. For most of the insurance companies, policies that focused on increasing market shares are already in the past.
Money has not yet become as cheap as it was two years ago, so shareholders are not willing to bear financial losses only for the sake of increasing market share.
Remember that the shareholders of insurance companies in Romania are financial groups of importance on the European market that were subjected to difficult tests in their own countries. Today, these shareholders seek profit and this cannot be achieved without seriously rethinking their business strategies in Romania.
My recommendation to the companies is to carefully manage their portfolios, to evaluate the risks of each type of insurance, to better foresee their administration and acquisition costs and, of course, to try as much as possible to reduce Motor insurance in their portfolio.

XPRIMM: What would be the greatest achievement of the Commission in this period and how do you intend to contribute, further on, to the so necessary maturing of the insurance market?
A.T.:
The stability of the market in the current economic context represents, I believe, an important achievement. The Commission has taken numerous steps to this end. To support the activity of insurance companies last year, ISC decreased the quantum of operating tax paid by brokers and insurers, and the MTPL insurers' contribution. The measure was taken to support insurers' efforts to reduce costs at a time of economic and financial crisis, but primarily to ensure the stability of the local insurance market. I think that for insurance products consumers, the stability of this market during the financial crisis represents a fundamental factor that will lead to increased confidence in insurance.
Regarding the Motor insurance regulation, I would like to summarise some of the measures adopted by the Commission during last year. So, starting on 1 January 2009, according to a rule issued by the Insurance Supervisory Commission with effect from that date, any Motor Hull insured has the right to obtain directly from the insurer the document for taking his own vehicle to be repaired if it was the only damaged vehicle, without a police presence being necessary anymore.
For MTPL policyholders, from 1 July 2009, an amicable constat report form was introduced to allow drivers to reach an amicable settlement of an event in which they were involved if it resulted only in material damage. In addition, the amicable constat procedure simplifies the recovery of damages. Also on the MTPL segment, a bonus-malus system entered into force that aims to encourage prudent behaviour by drivers on the road by reducing the insurance premium or penalising drivers depending on the number of accidents they are responsible for, and making the electronic issuance of the MTPL policy mandatory. I would not like to rank the Commission's achievements. All measures taken by the ISC are aimed to protect the interests of policyholders and to increase market stability. Therefore, I believe that all our decisions are important.

XPRIMM: What do you think can be done to increase customer trust and the demand for insurance solutions? Do you believe that insurers have the necessary means and that they should be the ones who act in this direction?
A.T.:
I think so. Moreover, last year the Insurance Supervisory Commission set as an objective an increase in seminars and training to inform the population and the insured about the necessity and the importance of insurance. Surely, in 2010 one would expect people to be better informed about what insurance is and why it is necessary. So all these seminars and training sessions are welcome, and I think insurance companies should get a lot more involved in this aspect by preparing and sending correct information to the insured in order to encourage their feedback.
For example, Romanians should understand that MTPL is an industry that operates within the same parameters throughout the world. Motor third-party liability is a mandatory insurance to protect third parties that has existed for many years and it was not invented in Romania. We, who are active in the field, understand it better. I think we had quite a lot of presentations so that the public understood this and so that it understands, first of all, what motor liability does and why it is mandatory. Any one of us, being a driver, can cause an accident and if we have such an insurance, we don't have to use our own earnings. And population needs to have a better understanding of Life insurance too because these products have a lot of benefits for those that buy them; they are long term and obviously the protection is active throughout all the time period. Slowly, people are beginning to improve their perception and certainly at the end of the year we will see more Life insurance contracts in the companies' portfolios.

XPRIMM: There are currently several initiatives to amend the MTPL legislation in Parliament. Are such changes really necessary?
A.T.:
No. MTPL legislation, in fact all insurance legislation, is transposed from EU directives through rules issued by the Insurance Supervisory Commission. Lately, we've consulted with both insurance companies that are authorised for Motor third-party liability and with insurance brokers, and in the coming period we will complete the final adjustments of the regulation for Motor liability that will only be to the benefit of and for the protection of the insured. But there are no fundamental changes to the regulation because its basis is well regulated and does not require any further changes. We will only improve some details of practice, where it was noted that perhaps not everything was perfectly written in the regulation - and here I refer in particular to claims resolution. I believe that the rule was clear, but if the market operators feel the need for further clarification we will do that - for the benefit of policyholders, certainly.

XPRIMM: Last year the ISC regulated the process of professional qualification and the continuous training of insurance brokers who are required to obtain a certificate of professional attestation. How do you think these new laws will regula- te the problem of insurance sales in Romania and how do you see the reaction of brokers to this issue?
A.T.:
As any educational system regulates a field as specialised as the insurance market. A well-trained sales force that can respond to consumer demand at a high professional level is the objective underlying the ISC decision to regulate the professional qualification process. Insurance contracts are, in fact, complex financial products that require a trained sales force, be it agents or brokers.

XPRIMM: What do you think insurers can do to encourage a more rapid development of a risk management culture in their companies?
A.T.:
The insurance industry is based on risk management. Therefore, I find it hard to believe that insurance companies operate without optimal risk management. Surely, this activity can be continuously improved, especially as the types of risk have diversified in recent years. However, this is linked to the policies and strategy of every company. It is clear that those companies that have a strong culture of risk management are those that have an advantage over their competitors.

XPRIMM: How did the Romanians' behaviour change in 2009, in the sense of interest manifested for protection and savings products and how do you estimate it will change this year?
A.T.:
As I said, lower population income, dramatically increased unemployment, as well as fears about job stability are the factors that made their mark on the life insurance segment in the first half of last year. I would not yet estimate the evolution of this sector in 2010. It is still too early for such predictions. Let us not forget that insurance market development is determined by the evolution of other markets, but especially by the economic conditions that favour the resumption of population consumption.

XPRIMM: What are the main reasons why society in general is reticent when it hears of insurers and insurance and how should companies counteract this attitude?
A.T.:
I think the main reason is insufficient knowledge of insurance products and of the benefits they provide. In Romania a culture of risk management does not yet exist as it exists in mature markets.
But it is built, as is anything durable, over time. We cannot make things move overnight because this industry is based on trust. All our efforts go in one direction, that of gaining consumer confidence that we are a strong, stable industry that provides protection and guarantees that it will pay for the effects of the insured risks.

XPRIMM: Although the Romanian insurance market is far from having no other major problems, the deadline for implementation of Solvency II is rapidly approaching. In light of the impact studies already conducted in our country, do you consider the insurance market is ready or it can be prepared in time for its implementation?
A.T.:
For Romania as for other countries, Solvency II will require changes to current business models - both in terms of insurance lines and of investments.
The Solvency II project is a set of directives that fundamentally alter many aspects of European insurance legislation. The basic structure of Solvency II will be similar to that in the banking sector, with three pillars: quantitative requirements, supervisory activities, and reporting and transparency. The objective of Solvency II is to increase the protection of insured persons and of the beneficiaries of policies, to deepen the integration of the European insurance market and to increase the competitiveness of insurers and reinsurers.
It is too early to comment on the impact that the Solvency II regime will have on insurers. However, since the purpose of this regime is to establish a more efficient allocation of capital within the insurance industry we can assume that better-managed companies will have an advantage over their competitors.

XPRIMM: What message do you have for the Romanian insurance
market?
A.T.:
To work with professionalism as it has worked before, and to forget about market share. Market share is not obtained by running after it but through the quality of services each company offers.

XPRIMM: Thank you!

by alexandru.ciuncan@mxp.ro,
vlad.panciu@mxp.ro

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Angela TONCESCU
Angela TONCESCU
President
Insurance Supervisory Commission (ISC)

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FIAR 2010 News


Angela TONCESCU: 2010, a true touchstone for the insurance market
"In the light of the most recent developments from Romania and given the quite gloomy outlook for certain indicators, such as the unemployment rate, the gross average salary, inflation and exchange rate, the ISC anticipates that 2010 will be a true touchstone for insurance companies", stated Angela TONCESCU, President of ISC, at the opening of the MAIN CONFERENCE at FIAR 2010.
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by andreea.ionete@mxp.ro, 25.05.2010



The net losses on the market decreased by more than five times in 2009, to RON 103 million
After having reported losses for the past three consecutive years, it was only natural for the insurance market to report negative financial results for 2009, given the financial crisis. However, the net loss recorded last year on the insurance market was more than five times lower than the one in 2008, going down from RON 576 million to RON 103 million.
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by andreea.ionete@mxp.ro, 25.05.2010



Cristi CONSTANTINESCU, UNSAR: 2010, the most difficult year after 1989 for the insurance market
"The Romanian insurance market experiences "interesting" times, although none of us would have liked to live them. I believe that 2010 is the most difficult year after 1989 for the Romanian insurance market, this perception being also endorsed by the figures reported after the three months of activity of the insurance companies, as they evolve at the same pace as the economy", stated Cristian CONSTANTINESCU, President of UNSAR, at FIAR, during the International Markets' Day.
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by mihai.cracea@mxp.ro, 25.05.2010



Insurance Brokers opened the 2010 Edition of FIAR
In the first day of FIAR, the INSURANCE BROKERS DAY brought together in the Bacarra Room the creme de la creme of the Romanian brokerage industry. Representatives of the insurance industry top management also took part. "On the whole, the brokerage market was less affected than the insurance market in 2009. But the overall economic context in Romania did leave its marks on our industry, as well. Unfortunately I cannot be over-optimistic and I even expect 2010 to be worse than 2009", according to the opening statement of the Brokers Day at FIAR, made by Mr. Bogdan ANDRIESCU, the chairman of UNSICAR.
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by vlad.boldijar@mxp.ro, 24.05.2010



ISC: Over 92% of the claims on MTPL have already been paid
Insurers have completed and paid 92% of all claim files opened on the MTPL segment in 2009 (341,462 out of the 371,342 cases), said the Insurance Supervisory Commission (ISC), which has centralized last years' data. The remaining 8% are in various stages of settlement.
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by andreea.ionete@mxp.ro, 19.05.2010



Ionel DIMA: IGPR reached out to insurers to help prevent motor insurance fraud
"The Department for Fraud Investigation within IGPR (General Inspectorate of the Romanian Police) reaches out to insurers. I realized that we haven't really had a collaboration relationship, therefore I suggest to the insurers' associations to establish a working group focused mainly on identifying collaboration opportunities in investigating and preventing motor insurance fraud", according to Ionel DIMA, Vice-president of AVUS Group, the moderator of the MOTOR INSURANCE DAY Conference at FIAR.
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by andreea.ionete@mxp.ro, 26.05.2010



GENERALI: When fraud is detected, prosecution should start immediately after rejecting the claim file
Following the introduction of the amicable report and in a difficult economic climate, insurance fraud experienced a hike during this first quarter, according to the specialists present at the Motor Insurance Day at FIAR. "In cases where fraud is substantiated, but no action is taken to start the prosecution, the parties involved become more intrepid, gain more experience, learn from their mistakes and are free to try their luck with other companies", underlined Madalin ROSU, Head of the Claim Management Department, GENERALI Asigurari.
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by andreea.ionete@mxp.ro, 26.05.2010



The new brokers helped improve the brokerage market's immunity
One reason for the improved immunity of the insurance brokerage market to the economic crisis was introduced today during the BROKERS' DAY at FIAR 2010, the reason being an increase in the number of players from this industry, given the reorganization of the insurance companies and not by the business increase experienced by the major players.
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by andreea.ionete@mxp.ro, 24.05.2010



Retail was the solution for 2009, but 2010 might bring a paradigm shift
Faced with a visible worsening of the corporate segment, the insurance market went for more aggressive development of retail sales in 2009. Both own sales forces of specialized companies and insurance brokers have "attacked" the perhaps more difficult, but also broader segment of individual customers.
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by andreea.ionete@mxp.ro, 24.05.2010



Bancassurance, the secret behind the growth of BCR Asigurari de Viata
The significant growth reported by BCR Asigurari de Viata, which sent the company, a member of the Austrian Vienna Insurance Group in the pole position on the life insurance grid operating on the "traditional" policies segment, is based on two factors: "the distribution channel (bancassurance) and the insurance product (index-linked)", declared Florina VIZINTEANU, Chairman of the Board, BCR Asigurari de Viata, during the FIAR conference on Life and Health insurance.
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by mihai.cracea@mxp.ro, 25.05.2010



Insurers that relied on lending sustained most losses
The main "culprit" of last year's decline on the life insurance market was the lower volume of loans granted by banks, "insurance companies that had a portfolio with a high share of such insurance policies sustained most losses", said FRANS van der ENT, General Manager, EUREKO Asigurari.
Meanwhile, "corporate life insurance had the biggest disadvantage on the insurance market, as they had the 'weakness' related to tax deductibility, respectively social contributions", stated the manager of EUREKO.
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by vlad.boldijar@mxp.ro, 25.05.2010

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VIG profit in Romania increases by 18% on declining business
Underwritings recorded in Romania by the Austrian VIENNA Insurance Group totaled EUR 147.4 million in the first quarter of 2010, down by 12.2% in European currency, compared to Q1/2009, when they registered a 16.4 % decrease. Also, companies members of VIG obtained a cumulated profit before tax of EUR 7.41 million, up by over 18%.
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by andreea.ionete@mxp.ro, 20.05.2010



17% decrease for the ALLIANZ-TIRIAC business in Q1, to EUR 68 million
The business of ALLIANZ-TIRIAC from the first quarter of this year amounted to almost EUR 68 million, down by 17% compared to the same period a year earlier, when the company had registered income from underwritings of RON 82 million, announced the insurer on the 1st of June, 2010.
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by andreea.ionete@mxp.ro, 31.05.2010



GENERALI achieves profit of RON 11.5 million and takes over RAI's business
GENERALI Asigurari registered during January-March 2010 a total gross written premiums of RON 114.5 million, decreasing slightly (-4.7%) compared to the first quarter of 2009 (RON 120.1 million), but March was the first month of growth in 2010, the underwritings volume going up 14% than in March last year. Meanwhile, in the first three months of this year, the profit reached RON 11.5 million.
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by mihai.cracea@mxp.ro, 19.05.2010



UNIQA Asigurari goes back in the black in 2009, after a loss of RON 143 million in the previous year
Less than a year after its takeover by UNIQA Group, UNIQA Asigurari has managed to recover from losses and turn in the black, as it obtained in 2009 a RON 2.47 million profit, after the previous year when the company had registered a RON 143 million loss.
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by andreea.ionete@mxp.ro, 19.05.2010



Mihai POPESCU aims to transform AVIVA into a solid player
Mihai POPESCU, the new CEO of AVIVA Romania, aims to bring the company in the black, even if not in the first years.
"The losses are an indicator of a company's commitment towards the overall market. Thus, a negative financial result can be a sign of massive investment", stated Mihai POPESCU, in the first day as CEO of AVIVA.
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by mihaela.circu@mxp.ro, 01.06.2010



ISC authorized Radu FRINCU as President of the Board of the EXIMBANK's insurance company
The appointment of Radu FRINCU as President of the Board of CARE - The Insurance-Reinsurance Company EXIM, owned by EXIMBANK, was authorized yesterday, May, 19, by the Insurance Supervisory Commission.
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by andreea.ionete@mxp.ro, 20.05.2010



21.5% of Romanians trust ASIROM
ASIROM is the insurance company that Romanians trust the most, according to the survey Trusted Brands 2010, conducted by Reader's Digest, surpassing in this chapter ING Asigurari de Viata, the leader of last year.
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by andreea.ionete@mxp.ro, 20.05.2010

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EASTERN Re: The Russian Insurance and Reinsurance Market in line with the World Economy
Last year, the Russian Insurance and Reinsurance Market followed the trend of the world economy affected by the economic recession: "Last year, the income of the specialized reinsurers went down by 40%, while the income of the insurers dropped by 10%", Dmitry DANILENKO, EASTERN Re, Russia stated at FIAR 2010.
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by vlad.boldijar@mxp.ro, 25.05.2010



MILLI Re: The Potential of the insurance market attracted massive investments in this field
"It is worth noting that the Turkish market experienced an increase in the volume of gross written premiums, although it sustained losses last year. The interest of foreign investors in the Turkish insurance segment is reconfirmed as well", Sezi MERIC from MILLI Re stressed.
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by mihai.cracea@mxp.ro, 25.05.2010



Development trends on the Moldovan insurance market
"The insurance market in Moldova is now at an early stage, the total underwriting volume amounting to EUR 50 million for 2009, about 1.4% of the GDP ", stated Veaceslav IONITA, representative of the Commission for Budgetary and Finance Affaires of the Parliament, Republic of Moldova.
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by vlad.boldijar@mxp.ro, 25.05.2010



BELORUSSIA: The statute of emerging economy protects us from the crisis, but the motor segment becomes an issue
"The market is at an early stage, therefore the effects of the financial crisis were hardly felt, but we still have the major issue of the motor insurance, dominant in terms of market share", Irina MERZLYAKOVA, General Manager of the Belorussia Insurers' Association explained.
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by mihai.cracea@mxp.ro, 25.05.2010



SAIPRO: The Central Asian insurance market is less affected by the crisis
"The dynamics of the local insurance premiums in the five Central Asian countries is directly influenced by the development of the economy. In the last two years, the insurance business dropped on these five markets, but this decrease was less serious than in other regions of the world", Dilshod SULTANOV from SAIPRO, Uzbekistan stated at FIAR 2010.
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by mihai.cracea@mxp.ro, 25.05.2010



14% decrease for Moldavian insurers in 1Q/2010

Insurance companies in the Republic of Moldova underwrote in the first quarter gross premiums worth EUR 11 million, down by around 14% compared with same period last year (up 7.7% in national currency), according to data submitted by the National Commission of Financial Market (CNPF). Thus, the general insurance segment cumulated underwritings worth EUR 10.3 million, or a share of 93.4%, while life insurance reached EUR 0.7 million.
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by oleg.doronceanu@mxp.ro, 03.06.2010



National Congress of Insurance Underwriters has come to its 2nd edition
The aim of the conference, organized by the NATIONAL Insurance Guild, and Association of Insurance Specialists Underwriters' Club in partnership with BUSINESS Format Group, is to create a new, democratic venue for exchanging experience, related to the vital issues of insurance underwriting, and working out the strategy of development. Also, organizers have committed themselves to enhance the Russian underwriters' professional reputation among the international community of insurers and clients as well as to develop methodological bases for assessing the underwriters' professional level.
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FINANCIAL NEWS


Romania's industry grows with 4.2%
Romania's Gross Domestic Product narrowed 2.6% in the first quarter on an annual basis, according to data from the National Institute of Statistics.
Industry was the only component to record an increase in activity, of 4.2%. Gross Domestic Product estimated for first quarter 2010 stood at RON 96.7 billion (EUR 23.5 billion), down 2.6% from the first quarter 2009, INF data show.
Construction sector has seen a sharp reduction in activity in the Jan-mar period, of 17.3%. Lower declines have been observed in agriculture, forestry, fishing and fish farming (0.9%), in trade activities, vehicle repair, hotels and restaurants, transport and telecommunications (-2.4%), in financial activities, real estate and services for enterprises (-1.5%) and other services (-2.7%).
As a negative consequence of the poor economic performance, tax collected to state budget dropped, net taxes on products falling 10.7%.
End consumption narrowed 4% on 4.8% lower expenses for household end consumption.
Expenditures for end consumption of public administration decreased by 1.8%.
by wall-street.ro, 30.05.2010


Greek banks in Romania post big Q1 profits
Hellenic banks in Romania report total profits of over EUR 32.5 million in Q1 of 2010, Hotnews reports. Banca Romaneasca had the biggest profit - EUR 12 million, followed by PIRAEUS Bank, with a net profit of EUR 10.3 million. ALPHA Bank came in third with EUR 8.1 million profit.
Twenty-two per cent of the local banking sector is covered by banks with Hellenic equity having major real estate exposures. However, recent difficulties in Greece do not seem to have had powerful direct effects in Romania because the Romanian banking industry, including Greek banks, is well-capitalized. Romanian banks' average capitalization rate is now 14 per cent, a lot above the minimum requirement, and Hellenic banks are also soundly capitalized and closely watched by the Romanian central bank BNR.
Under the said conditions, PIRAEUS Bank Romania's gross profit posted for Q1 this year grew to EUR 10.3 million. The bank yesterday informed that managed assets on March 31, 2010 had been up by 2 per cent from year earlier, topping EUR 2 billion. In addition, in Q1, attracted deposits' volume rose by 7 per cent from year earlier. PIRAEUS Bank Romania's total deposits attracted had exceeded EUR 1.19 billion in March 2010.
ALPHA Bank also posts a profit before tax of EUR 8.1 million, with bad loans up to 4.3 per cent. In a report to the Hellenic stock exchange, the Greek lender currently has 8.3 per cent market share in Romania compared to 8.9 per cent at the beginning of 2010. The bank has awarded total loans of over EUR 4 billion and raised deposits of over EUR 1.5 billion. The bank's profit was down by 62 per cent from year earlier in the context of bad loan losses amounting to EUR 24.5 million according to disclosures to Athens-based stock exchange.
Another Greek bank, EMPORIKI, in April 2010 injected EUR 25 million into its Romanian subsidiary after a previous equity injection of RON 78.5 million performed in February. Shareholders find that EMPORIKI Bank Romania has consolidated its position on the local market as its lending portfolio has gone up by 61 per cent and deposits by 21 per cent in the last two years.
BANCPOST in Q1 made EUR 2.1 million net profit after the EUR 4.1 million loss posted for 2009. The lender in Q1 registered provisioning expenditures of EUR 63 million and its share of bad loans went up to 13 per cent of portfolio. EUROBANK's local assets were down 2.5 per cent in the first three months this year at EUR 5.47 billion.
Hellenic financial group National Bank of Greece (NBG) - majority shareholder in Banca Romaneasca - posts net profit of EUR 12 million for Q1. Earnings were higher by 71 per cent on a year over year basis, according to the groups' reporting in Athens. The same Hellenic group also operates a leasing company, a stock brokerage company and an insurance brokerage company, with reported results being consolidated for all subsidiaries. The hike in net profit came from the growing operating income especially the fee and commission income registering a four-fold increase at EUR 12 million.
by wall-street.ro, 3.06.2010


Romanian-Turkish trade to reach USD 10 billion
According to TIAD, Turkey absorbs almost 25 per cent of Romania's exports outside the EU.
In Q1 of this year Romania reported a surplus of some USD 185 million in its trade with Turkey, according to data presented on Friday by the Association of Turkish Businessmen (TIAD). Thus, in Q1, Romania's exports to Turkey reached USD 694.1 million, while imports from Turkey reached USD 509.17 million. TIAD officials stated that exports have grown by 75.1 per cent compared to the same period last year, while imports have grown by 22.5 per cent. Romania's exports to Turkey mainly consisted of metals and metal products (USD 305 million), cars and electrical equipment (USD 94 million), mineral products (USD 81 million), vehicles and transportation equipment (USD 62 million).
Romania's imports from Turkey consisted of cars and electrical equipment (USD 115 million), metals and metal products (USD 82 million), textiles (USD 69 million), vehicles and transportation equipment (USD 51 million). Mustafa YARDIMCI, President of the Edirne Stock Market, estimates that bilateral trade will reach USD 10 billion this year, pointing out that the medium-term goal is for it to reach USD 20 billion. In 2009, the Romanian-Turkish trade reached approximately USD 4 billion, 41 per cent less than in 2008 back when it reached USD 7.5 billion. He added that there are multiple domains of cooperation between the two countries, the main ones being: energy, tourism, transportation, industry and software.
According to the data presented, Turkey absorbs almost 25 per cent of Romania's exports outside the EU, and is the source of 13.3 per cent of Romania's imports from outside the EU. At the end of Q1 Romania's external trade reached EUR 17.7 billion, EUR 7.9 billion in exports and EUR 9.8 billion in imports.
The forum provided with an important platform for exploring new opportunities of collaboration in the fields of energy, transport, construction, tourism and health. Turkish and Romania businessmen also discussed possible joint projects in both countries and elsewhere as well.
On the occasion of the meeting, Turkish Justice Minister Sadullah ERGIN held talks with Justice Minister Catalin PREDOIU, Minister of Transportation and Infrastructure Radu BERCEANU and Minister of Economy, Trade and the Business Environment Adriean VIDEANU. During the talks, the ministers exchanged views on Turkish-Romanian relations in the fields of economy, transportation, energy and justice. At the end of the meetings, both sides agreed on intensifying their cooperation on making better use of the Black Sea as an important route between Europe and Asia through the Caucasus. To this end, parties decided to increase their efforts to improve connectivity between the Black Sea ports of two countries and to increase cooperation on the Danube.
by nineoclock.ro, 30.05.2010

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