CYPRUS: Hellenic Bank is to revise its activities in the insurance sector

Hellenic Bank is about to revise its insurance activities to discover the best alternatives for the subsidiary insurance companies, according to the portal insuranceworld.gr of Ethos Media.

Hellenic Bank is one of the leading financial institutions in Cyprus, which, aside from traditional loan and deposit banking products, offers a wide range of banking and insurance services (through two insurance companies: Pancyprian Insurance and Hellenic Alico Life).

The objective is to increase revenue from insurance activities, which, as the bank representatives noted, remain a key focus area. As the bank indicates, after the acquisition of certain assets and liabilities of the Cyprus Cooperative Bank on September 3, 2018 and the relevant customer base, there are improved opportunities for developing the Bank's insurance business through its affiliated insurance companies.

"In this context, the bank will review in the first half of 2019: (a) the position of its insurance subsidiaries in the insurance market; (b) bancassurance contracts through which the bank distributes insurance products by its insurance subsidiaries; (c) the bank's strategy to maximize the outcome of insurance and bank security services", as the bank explained in its official statement.

Hellenic Bank is active in the insurance sector through two subsidiaries: Pancyprian Insurance Company and Hellenic Alico Life Insurance Company. The total net income of insurance business as of 30.09.2018 amounted to EUR 9.5 million (representing 5.2% of the Group's total net income) and in 2017 that figure reached EUR 12.9 million (5.5% of the total net income of the Group).

In January, 2019 Moody's upgraded Hellenic Bank's long-term deposit ratings to B3 from Caa1, and its long-term Counterparty Risk Ratings (CRRs) to B1 from B2. The outlook is positive.

The upgrade of ratings was driven by changes in the bank's liability structure. In particular, the issuance of EUR 220 million of Additional Tier 1 (AT1) securities in December 2018 and the rating action captures the bank's strengthened franchise, asset quality and capital following the integration of EUR 9.3 billion of predominantly performing assets and liabilities acquired from the Cyprus Cooperative Bank and a capital increase of EUR 150 million, according to Moody's.



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