Going for the quarter mile...

At the end of August, Romanian government approved amendments to the Law concerning the mandatory households insurance against natural catastrophes (earthquakes, floods and landslides).

The law was passed to the Romanian Parliament for the debates in an urgent procedure and was discussed and approved by the end of the week by the National Committee of Public Administration, Territorial Management and Environment Protection of Senate, the upper house of Parliament.

Despite all achievements, there are a lot of issues that need to be clarified and closely analyzed.
Therefore, according to some studies, the EUR 145 millions which are to be cashed in case of a penetration rate of 80%, are not enough to cover the cost of reinsurance. In this context, it is strongly recommended an introduction of a deductible franchise of approximately 7%.

Although the franchise has already been practiced by some insurance companies, mostly for CASCO policies, when it comes to the mandatory households insurance, some companies have problems, especially in explaining the franchise concept.

Because of that, a probable refuse of paying the claims that have a reduced value could affect the credibility of the entire insurance industry, according to specialists from the insurance companies.

An alternative solution might be the increase of the price of policies for this class of insurance. At the end, it seems like this alternative isn't agreed by the government's representatives.

Therefore, what is to be done to accelerate the improvement of a Law that will certainly help thousands of people affected by the natural catastrophes?

Till that moment when they will realize the advantages of the deductible franchise, Government will pay the claims at every rain...

by mihaela.circu@mxp.ro

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Interview with Mr. Cristian CONSTANTINESCU,
President,
UNSAR - National Association of Insurance and Reinsurance Companies from Romania

XPRIMM: 2007 meant not only the UE adhesion for the Romanian insurers, but also a very important step for the professional association that is representing them, which earned a real European status. What does the full membership of CEA (Comite Europeen des Assurances) mean for UNSAR?
Cristian CONSTANTINESCU: From the moment UNSAR became an associate member of CEA, at the beginning of 2006, and afterwards a full member of the organization, I can say that there is a stringent obligation for us to constantly relate our activity to the European insurance market and to the standards it requires.
Above the opportunity of contributing to strategic projects for the insurance market in Europe, we find the immediate benefits which arise from the access we now have to the relevant experiences of the other member states of CEA. These represent a great information source regarding legislation and practices in the mature markets and for us, as a professional association with a consultative role in market regulation, the information provided by our European colleagues is a very useful addition to our very own experience, helping us to compose and to bear up a professional point of view.
Our contribution to the health insurance legislation set up is only one consequence of these benefits. Another good example in this matter is our intervention regarding the elaboration of the legal frame needed for the introductio of the amicable report.

XPRIMM: With regard to the amicable report, what was the path followed by UNSAR towards the Government decision to introduce this procedure?
C. C.: The authorities haven't understood from the very beginning the specific of this "agreement" which applies to motor claims, wherefore from the position I have in the Association I have spent a lot of energy and I lay myself out and thus we managed to bring out a more adequate specification of the normative act towards the amicable report for its debate in the Parliament.
The good thing so far is that the necessary norms for the amicable report implementation are brought forth by a working team at which UNSAR and ISC (Insurance Supervisory Commission) representatives also take part. This gives us the certainty that insurers will be able to win through more easily the attendant difficulties came out from the implementation of such major amendment. It won't be easy as this will require an important financial effort and an internal procedures adaptation which will stress the insurers a lot, but still the chances for the process to pass off without major impediments are significantly bigger.
The full membership at CEA was of real help this time too; thus we could draw very important information risen from the experience of the members who embraced the amicable report before us. Above this, let's do not forget that CEA is the initiator of this procedure in Europe and all states which implement the amicable report must respect standards and procedures elaborated by this organism. If we take into consideration that embracing this procedure has serious implications for resolving international claims, the benefit arising from here is even greater.

XPRIMM: What are the main focuses of UNSAR activity besides the legislation frame?
C. C.: Our contribution to the legal framework draw up is obviously a priority. It has to be this way as we pass through a stage when important normative acts are still issued, laws on which the future of this market depends, that will generate major effects for each company. There are still projects of real interest for the insurance market to be conceived at this moment. But what will decide upon the success of these projects is the opening for communication with the operators: their opinions must be incontestably taken into consideration because they know the practical implications best.
However, beyond this focus, we are interested in contributing to the market education. An UNSAR project that I have personally supported from the very beginning was the realization of a TV show, integrally financed by the Association especially for peoples' education in the financial protection through insurance. I hope this won't be the first and the only action in this direction.
An initiative which meant a lot for me and gives me a "fruition" feeling was focused on a better communication between the Romanian insurance market operators and the supervisory commission. We succeeded in initiating a series of informal periodical meetings between the ISC representatives and insurers for a more opened and efficient communication. I am glad the first steps have been made while the existence of this opening is, in my opinion, a big plus for the market.

XPRIMM: You are the General Manager of the company which holds the leading position in the Romanian insurance market for several years by now. From this particular perspective, how would you define the actual development stage of the insurance market in Romania? How close/far are we from what one could name a "mature market"?
C. C.: The growth seen by the Romanian insurance market in the late years is really consistent and this certainly represents a significant achievement. However, I think we should be more careful on how this growth is being generated because, from my point of view, what we are witnessing is not a fully healthy growth.
As for maturity, there are some more stages to go before we could consider that our market has grown mature. Romanian insurance is still witnessing issues that do not belong to a mature market. For example, in a mature market differences from simple to triple between premium rates do not exist. Also, one should not meet an offer reduced by 50% after the negotiation, as it frequently happens in Romania. The worst part is that here the insurance consumer does not exactly know what this product implies, how to differentiate the financial product of insurance from any other palpable good. I think insurance should gain the customers trust more easily.
But unfortunately the price is the key element when buying insurance, especially in the MTPL insurance case when people think very simple as it is a third party insurance. So if a company practices very low prices for three, four or even five years, it will have no chance to actually keep its clients' portfolio after it would have to increase prices to the level they should be.
The MTPL's price level is now absolutely ridiculous and would cover hardly anything from an eventual major claim.

XPRIMM: How do you comment on this situation from the companies' profitability point of view?
C. C.: If we take a look at the evolution of profitability, the image becomes totally confusing.
There are companies in the market which afford to come out in loss even without winning or winning too little market share, on a long period of time. Supposing one applies a limited time period market share strategy, assuming thus losses for a certain phase, this might be even more convenient than buying market share through an acquisition. Nevertheless, the success of this strategy implies reclaiming those losses in time and especially maintaining the clients you have bought. Hence, the balance is pretty fragile and I don't think you can force the growth of a performance index without considering collateral implications and future effects. But this still happens in the Romanian insurance market and I am curious until when would some shareholders finance financial losses that do not seem to bring any other benefits.

XPRIMM: Then, could we say that our market will start becoming a mature one when the competition for market share will calm down?
C. C.: This situation would rather be a result. The competition exists and continues in every market in the world. In Romania instead is a competition that I would rather call... naive; we enter the competition without assessing the potential results.

XPRIMM: How do you see the cooperation between Romanian insurers and insurance brokerage companies and what are the development perspectives of this relation?
C. C.: When we speak about brokers we must always start from the definition of the insurance broker. If we talk about real brokers, they do not have absurd request because they have adequate training and fluently speak the insurance "language". In this case, even if a client asks for something really abnormal this broker will be the first to guide him towards a product that will best fit its needs.
In 2005, ALLIANZ-TIRIAC had over 60% of the total written premiums mediated by brokers, fact which I have seen as a very good sign. Personally, I feel much more relaxed when working through brokers because then I enter in competition with any other company on the market as this competition is not only about the price level, the premium rate. Normally, brokers know how to compare two similar insurance conditions and understand exactly what an exclusion means. When working with brokers there is a chance for fair competition and quality has its say. Accordingly, brokers must inherently have a major role in the market.

XPRIMM: Thank you!

by andreea.ionete@mxp.ro

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Mr. Cristian CONSTANTINESCU,
President,
UNSAR - National Association of Insurance and Reinsurance Companies from Romania

Private Pensions, a fulfilled commitment
"The private pension system represents a fulfilled commitment of the present politic class", Traian BASESCU, the President of Romania declared on the occasion of the debut of the adhesion period to the private pension funds.
"Private pensions can be a successful story and a catalyst for economy and the people's prosperity growth. The politic class has the obligation of creating the conditions for the development of pension funds", the Romanian's president added.
The 17th of September 2007 is the beginning date of the four months period for the adhesion to one of the pension funds authorized to operate on Pillar II by the Private Pension System Supervisory Commission.
"From this day, Romanians become investors because funds will educate people in the spirit of saving. I regret that I don't meet the legal conditions as to be able to contribute to this system", Traian BASESCU highlighted.
The Romanian president characterized the state pension system as being in a disastrous situation, being extremely vulnerable because of the many politic interventions.
In conclusion, the president said:" I encourage young people to contribute to a private pension fund because these are not as vulnerable as state pensions".
In the context of the debut of the adhesion to Pillar II, PRIMM Insurance&Pensions Magazine organized the National Conference of Private Pensions on 25th of September 2007 at Sala Parlamentului from Bucharest. The event was the most important of the cycle of regional forums.
Representatives of the public central and local administration, politic personalities, main operators in the private pension field, specialists in human resources of important employers from Bucharest and territory and media representatives took part at the conference. The pension reform and its advantages for employers and employees was one of the themes debated.
by liviu.huluta@mxp.ro, 17.09.2007

Jose PINERA: Romania is on the right way
"As concern the reform of pension system, Romania is on the right way", this is the conclusion drawn by Jose PINERA, the author of the most revolutionary reform in this field in Chile and international known specialist in the privatization of the pension systems. Member of the Chilean Government in 70's and 80's, PINERA came in Bucharest at the invitation of Mihai SEITAN, Partnerships Director of the private pension broker, FINCOP.
Starting with 2000, Jose PINERA and Mihai SEITAN, have been working together, within a wide collective of Romanian and foreign specialists" at the "plantation of private pension's seeds in Romania", as PINERA has declared.
He is the upholder of the theory according to which the main solution for the pensions' reform is the change of the entire model from the base of the PAYG system (Pay AS YOU GO - active persons contribute for the retired persons' pensions) and the implementation of a multi-pillar system, a combination between the compulsory funds administrated by the state and the private companies and facultative accumulation funds.
"People must have their pensions in individual accounts and not collective and to be aware of the fact that if they don't work, don't make incomes and don't save, it's impossible to have an easy life at retirement", the specialist from Chile has concluded.
by alexandru.ciuncan@mxp.ro, 14.09.2007

Here are pensions!
The operators of compulsory private pension market have entered the fieriest battle from the Romanian financial market's history. On the occasion of the start of private pension market, Traian BASESCU stated: "The creation of private pension system represents a fulfilled promise of the present politic class".
"I want to assure the future operators that all politic measures will be taken as to create an propitious economic environment for the development of pension funds", the president declared.
During the event that marked the start of private pension market Varujan VOSGANIAN, the Ministry of Economy and Finance, stated: "From now on, the transition has come to an end for Romania, Romanians are investors on pension plans and pensions are not anymore the result of politic negotiations, but the dividends of investments made by the pension funds".
Taking into account that many operators on the private pension market come from insurance market, Angela TONCESCU, President of Insurance Supervisory Commission, stated: "I believe the professionalism of the employees of companies, which administrate pension funds, will play a vital role as to transmit the needed safe to this system. Also, an important role for the good function of the market has the supervisory activity.
"To the private pension fund one can adhere by signing only one adhesion contract. In case one signs more documents, it's possible that the employee to be allotted to another pension fund", Mircea OANCEA, President of Private Pension System Supervisory Commission, declared drawing attention upon the problems that the Commission might face with during the underwriting process.
The system is not perfect, but, surely, is perfectible and the officials' and funds' interest in this market should raise the interest of eligible citizens for a private pension fund.
by liviu.huluta@mxp.ro, 17.09.2007

BCR, intermediary on Pillar II
BCR was authorized as intermediary in the sale of compulsory private pensions by the Private Pension System Supervisory Commission. Thus, the clients of BCR can adhere directly to BCR Fond de Pensii in either of the banks of its network.
Martin SKOPEK, retail vice-president of BCR believes that the compulsory private pension scheme of BCR matches the bank's policy of having long term partnerships with its clients.
"We are here to build and develop a long term relation with our clients and the pension scheme proposed by us is a good instrument to fulfill this goal. We would like to offer our clients a valuable service , available on long term, provided by the most powerful financial group from Romania", Martin SKOPEK has stated.
"Actually our services address to all eligible persons, inclusive to those aged between 35 and 45, who can opt for a pension fund professionally administrated", the quoted official has added.
BCR will offer this service both persons aged between 18 and 35 and those aged between 35 and 45, for whom Pillar II is facultative.
BCR Fond de Pensii Administrat Privat is administrated by BCR Administrare Fond de Pensii , company within BCR Group, important member of ERSTE holding. The company has a social capital of RON 50 million and was established in June 2007.
by mihaela.circu@mxp.ro, 17.09.2007

Big financial groups on private pensions market
BRD Fond de Pensii launched yesterday, during a press conference, the newest company part of BRD Group, subsidiary of Societe Generale.
The company which will administrate pensions funds is the result of a joint-venture between SOGECAP (Societe Generale Capitalisation), Societe Generale life insurance company, which owns 51% of bonds, and BRD-Groupe Societe Generale, which owns 49% of the company.
SOGECAP is one of the biggest players on French life insurance market and it is on the forth place in the top of bancassurance companies. SOGECAP managed, by the end of 2006, over 5 million contracts valuing almost EUR 60 billion.
"BRD and SOGECAP are two important members of Societe Generale group, with complementary competences. Both companies united their forces and experience in a useful partnership, to help the clients", declared Petre BUNESCU, Vice General Director of BRD-Groupe Societe Generale.
"The results of the adhesion brought about 3,500 clients in the first days for private pensions fund administrated by BRD Fond de Pensii", stated Damien MERCHAL, General Director of BRD Fond de Pensii.
On the international plan, SOGECAP is present in 12 countries and has an ambitious expansion plan. In 2006, SOGECAP registered EUR 9.68 billion turnover, increasing by 21%. The assets administrated by SOGECAP are valuing about EUR 60 billion.
by liviu.huluta@mxp.ro, 20.09.2007

5% of the agricultural insurances' underwritings for the Disaster Fund
The Romanian insurance companies agreed to contribute with 5% of gross earned premiums from agricultural insurances to the establishment of the National Disaster Fund in Agriculture.
This proposal is made in the letter of National Association of Insurance and Reinsurance Companies from Romania addressed to the Ministry of Agriculture and Rural Development, Decebal Traian REMES.
From the insurers' point of view, also the agricultural producers, providers of services, works, of raw material and materials should contribute to the establishment of this Fund.
At present, Ministry of Agriculture and Rural Development agrees to 13 insurance companies: AGRAS, ALLIANZ-TIRIAC, ARDAF, ASIBAN, ASIROM, ASITRANS, ASTRA-UNIQA, BCR Asigurari, CARPATICA Asig, FATA Asigurari, GENERALI Asigurari, OMNIASIG and UNITA.
The volume of gross written premiums on this segment was RON 53.7 million during 2006 - 2007 agricultural years. In the same time, the paid claims reached RON 48.3 million on 31st of July 2007. Analyzing these data, the loss ration is 90%.
by mihaela.circu@mxp.ro, 24.09.2007

FINCOP Pensii Private invests EUR 10 million in Romania
In the next period, FINCOP Broker de Pensii Private, member of SALVE Group London, will invest approximate EUR 10 million for the network's extension and for the units' improvement.
At present, the company has 40 agencies in Bucharest and in other towns in the country. Only in Bucharest, Oradea, Cluj, Timisoara, Iasi and Constanta, approximate 10,000 persons registered for private pensions and to inform others about this pension system.
SALVE Group acts as market's integrator, consolidating local companies in a powerful financial group and bringing West European standards regarding financial consultancy and financial products of high quality.
On the Romanian insurance market, FINCOP will offer besides private pensions a large range of life insurances, health insurances and facultative pensions. At present, FINCOP collaborates with INTERAMERICAN, ALLIANZ, GENERALI and BT AEGON and in the future other companies will join.
FINCOP Broker de Pensii Private has experience in the private pension field, implementing successfully this system in Czech Republic and Slovakia
by mihaela.circu@mxp.ro, 21.09.2007

GRAWE interested in compulsory house insurance
The insurance company GRAWE is interested in participating to the Insurance Pool against Natural Disasters.
"We want to be shareholders within the Insurance Pool against Natural Disasters and to offer our clients this useful insurance - compulsory dwelling insurance", Peter KASYK, General Director of GRAWE Romania stated.
Though, until now, GRAWE has operated only on life insurance segment, the quoted official declared that the company has all the authorizations needed to subscribe to Insurance Pool against Natural Disasters.
According to the bill, the Insurance Pool against Natural Disasters is an insurance reinsurance commercial company which administrates the risk fund for the payment of the sum insured in the compulsory system in case of natural disasters to the companies allowed signing compulsory dwelling insurances in order to pay the claims. This is established through the association of authorized insurance companies to sell this type of insurance and other legal entities according to the law.
In the first semester of 2007, GRAWE underwrote over RON 35.4 million on life insurance segment, registering a 56.7% increase comparing to the similar period of previous year. Also, the insurer made a net profit of RON 3.77 million, with 121% more than the similar period of last year.
by mihaela.circu@mxp.ro, 26.09.2007

Pillar III: over RON 1 million assets and around 10,000 participants
The volume of assets accumulated by the active companies on Pillar III exceeded RON 1 million at mid September.
Thus, assets registered RON 1.107 million during 7th - 14th of September, up with 14.49% comparing to the previous week, according to the data published by the Supervisory Commission of Private Pension System.
The number of participants on Pillar III is near 10,000.Until now, 9,730 Romanians have opted for a facultative private pension, most of them (4,943) opting for AZT Moderato administrated by ALLIANZ-TIRIAC Pensii. ING Clasic Fund was chosen by 2,184.
1,529 persons have preferred Pensia mea administrated by AVIVA.
Specialists estimate that the number of those opting for Pillar III will increase after the beginning date of the adhesion period to Pillar II. One is expecting that the presentation in media of Pillar II will lead to the awareness of the private pension's necessity both among young people and among those over 45 years old.
by mihaela.circu@mxp.ro, 21.09.2007

BRD attacks the insurance market
BRD Group, newly entered on Romanian privately administrated pensions market, intends to open an insurance company for the local market.
Since BRD Fond de Pensii represents a joint-venture between BRD and SOGECAP (Societe Generale Capitalisation), the last one activating also on life insurance market, they will set up a new company dedicated to life insurance.
SOGECAP is the life insurance company of Societe Generale Group. It is on the forth place in the top of bancassurance companies and on the fifth place in the top of life insurance companies in France.
"We want to use the experience of the group on life insurance market, now, when we have the necessary structure to attack this sector", stated Damien MARECHAL, General Director of BRD Fond de Pensii.
BRD Fond de Pensii will also enter the optional pensions market. "In the next maximum eight months we will be able to offer to Romanian clients two optional pensions funds, in order to enlarge our service palette", Damien MARECHAL added.
by liviu.huluta@mxp.ro, 20.09.2007

RAIFFEISEN sold ARDAF bonds
RAIFFEISEN Zentralbank has sold, during the meeting on Tuesday, September 18th, 2007, 9.23 million titles of ARDAF insurance company. The total value of the transaction reaches RON 1.38 million, the nominal price of one bond being RON 0.15, shows the RASDAQ press release.
In present, the insurer is owned in proportion of 70.8% by SABILE Company, member of PPF Investments Czech group.
Recently, it was initiated a reorganizational process.
"The order word within ARDAF is 'reorganization' and when I state this I am referring to a substantial reorientation towards quality and value direction, disfavoring the quantity.
The accent is put on a healthy increase, development of balanced portfolio, improving of goods and services and a correct subscribing policy, managed on protection principles", Daniel TUDOR, President General Director of ARDAF recently stated.
by mihaela.circu@mxp.ro, 21.09.2007

Thousands of signatures in the first week
The National Conference of Private Pension was a good occasion for the operators to present their results obtained in the first days of activity.
Though many companies boasted with several thousands of adhesion in the first day, ING impressed with 178,000 signatures obtained in the first seven days of activity. In the same interval, AVIVA registered 65,000 signatures.
"In the first week, 40,000 contracts were signed with FINCOP Broker de Pensii", Mihai SEITAN, General Director of the company, stated.
"It would be better big figures to be let for the end of the campaign because they aren't relevant now", Dr. Crinu ANDANUT, CEO of ALLIANZ-TIRIAC Pensii declared.
The contracts' number seems to be closely connected to the sale force authorized of each company. Thus, from the 160,000 authorized agents, ING has 41,000, AVIVA 30,000 and ALLIANZ-TIRIAC 22,000.
by liviu.huluta@mxp.ro, 26.09.2007

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Reinsurances in Russia - one more step
"Russian reinsurance market owns about 80-90% of reinsurance premiums and payments managed in the CIS territory", stated Ana FADEEVA, Reinsurance Department Director within TRANSSIB Re.
In 2006, Russian Federation registered 325 companies which practice the reinsurance activity and 30 specialized reinsurers.
Reinsurance premiums volume in Russia represented in 2006, over USD 3 billion, USD 860 million being collected by specialized reinsurance companies.
Comparing to 2005, the market registered a decrease by 20%, due to the settling measures introduced by the Russian Insurance Supervising Federal Service.
These measures refer to new requirements regarding the minimum social capital of the insurance companies (USD 5 million), assets total value and insurance companies reserves, as well as the necessity to obtain the license for reinsurance activity, measure required starting with July the 1st , 2007.
The specialists appreciate that the tendency to decrease the number of reinsurance companies will continue, fact that will support the rise of the market stability.
We remark also that an increasing number of reinsurers from Russia received international ratings (14 companies have international rating).
The Russian reinsurance market has become more transparent lately as the so called "schemes" are disappearing.
by oleg.doronceanu@mxp.ro, 20.09.2007

Bulgarian Parliament approves insurance guarantee fund
The Bulgarian Parliament approved the amendments to the Insurance Code. One of the main proposals is the organisation of a specialised compensation fund which is to make payments to the clients of the insurance companies gone bankrupt, according to insurance.bg.
This special guarantee fund will cover the payment of claims filed under motor third party, casualty, sickness and all types of life insurance policies in case the company from which the insurance product was purchased goes bankrupt.
Similar security system is already introduced in the banking system covering for deposits and resources lent to investment agents.
The changes to the insurance code that were legislated to create the fund also disallow regressive claims.
The local insurers commented that the revised code will be an incentive to the bottom-feeders, motivating consumers to buy coverage from the company offering the lowest price and not from the best-managed and financially stable companies.
The Association of Bulgarian Insurers is of the opinion that the payouts that will be made by the fund should be capped off.
Other amendments unify the Bulgarian Law with the common European legislation regarding the reinsurance practice and meet the deadline - December 10th 2007. There are amendments aiming at better clients protection in the insurance field, too.
by oleg.doronceanu@mxp.ro, 20.09.2007

TRIGLAV privatisation vote on 11 November
Slovenian voters will head to the polls on 11 November to decide on whether more than a third of Zavarovalnica TRIGLAV, Slovenia's largest insurance company, should remain in state hands or should be divided among former policy holders, according to the National Assembly, Slovene Press Agency reports.
The lawmakers voted yesterday to call the referendum on changes to the act on the privatisation of insurance companies as demanded by the National Council, the upper house.
They set 11 November, the date of a possible second round for the presidential election, as the date of the ballot.
The National Council adopted a request for the referendum arguing that the government-sponsored changes would exclude some 750,000 people from the privatisation of market leader TRIGLAV.
The law originally stipulated that former TRIGLAV policy holders would be able to take part in the privatisation. It determined that individuals would be entitled to about 35% of the share capital.
However, the government later adopted amendments that transfer the 35% stake to the state-run Pension Fund Management (KAD), whose task is to provide extra pension and disability insurance funds.
The government has argued that it is impossible in practice to privatise TRIGLAV in a way that would allow the former policy holders to participate.
Finance Minister, Andrej BAJUC reiterated that two finance ministers have tried to divide the shares among former policy holders but have not managed to find a way to do so. "A search of all people entitled to the stake would prove too costly", he added.
by Slovene Press Agency, 26.09.2007

ALLIANZ strengthens its role as leading CIS insurance player
After fostering its leadership position as foreign insurer in Russia, ALLIANZ is now entering the Kazakh insurance market by acquiring 100 per cent of the shares in ATF-Polis from ATF-Bank.
ATF-Polis is the fourth largest insurance company in Kazakhstan with gross premiums written of USD 42 million in 2006. The insurer will continue to benefit from the distribution capacity of ATF-Bank as one of the largest banks in Kazakhstan as laid down by a bancassurance agreement. Furthermore, the recent acquisition of ATF-Bank by the Italian bank UNICREDIT will allow ALLIANZ to extend the longstanding partnership with UNICREDIT to Kazakhstan market.
"This market plays an important role in the CIS which shows enormous potential of growth. By entering Kazakhstan now we will ensure our position in this interesting market," commented Werner ZEDELIUS, Board Member of ALLIANZ SE, responsible for growth markets, this move.
"Being one of the leading insurance service providers worldwide combined with long industry experience, ALLIANZ will give ATF-Polis a new push on the development by implementing state-of-the art technologies and strengthening the insurer's position in the Kazakhstan insurance market. In the same time ATF-Bank and ATF-Polis will remain partners and will continue our mutually beneficial cooperation as laid down by agreements between both companies," added Talgat KUANISHEV, CEO of ATF-Bank.
With this acquisition ALLIANZ is undertaking a major step in entering the 3rd CIS country, after Russia and Ukraine, and will participate significantly in one of the largest and fastest growing markets in the CIS region. In 2006 the Kazakh insurance market had a volume of USD 600 million and is estimated to grow to USD 2 billion by 2010.
"This transaction enables us to access different client segments in Kazakhstan and to provide our customers with a whole new range of products which will complement with the existing ATF-Polis products. They will benefit from our local knowledge and international expertise", said Hannes S. CHOPRA, CEO of ALLIANZ Eurasia, responsible for all CIS markets.
ATF-Polis has been established in 1999 as part of the ATF financial group and is the 4th largest insurance company in Kazakhstan based on 2006 statistics. The insurer has a countrywide presence in the 16 largest cities of Kazakhstan and a well balanced portfolio and distribution channels structure.
by irina.galasanu@mxp.ro, 25.09.2007

MOODY's has confirmed the international rating of the Ukrainian GENERALI Garant
International rating agency MOODY's has confirmed its Ba3 financial stability rating (IFSR) to the Ukrainian insurance company GENERALI Garant, under obligations in a foreign currency.
The outlook is stable (Ba3 is the highest possible rating of the insurance company in Ukraine).
In November 2006, MOODY's changed GENERALI Garant's rating from B3 to Ba3.
Under obligations in national currency, rating agency asigned to Ukrainian insurer rating at Baa2 (Baa2 is a rating of an investment class and testifies the stability of the credit reliability of the company, an adequate opportunity to duly payments).
On the national scale insurer received the highest possible rating - Aaa (the highest credit reliability, an exclusive opportunity concerning duly payments).
The Ukrainian insurance company GENERALI Garant (earlier - GARANT-AVTO) was set up in 1992 as a specialized company on insurance of motor transportation risks. The company has more than 50 offices in Ukraine and is among the markets leaders on the Ukranian insurance market.
Rebranding to GENERALI Garant has been connected with arrival of the new shareholder - Italian GENERALI Vienna Group which in June 2006 purchases 51% shares of the company.
GENERALI Group gathers more than 170 insurance companies and 120 financial organisations.
by oleg.doronceanu@mxp.ro, 26.09.2007

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World Bank report: Romania improves slowly among business-friendly countries
Romania comes 48th out of 178 countries in terms of easiness to launch a business, one place higher than in 2006, according to the "Doing Business 2008" World Bank (WB) report.
This year, Romania reports the best results in getting credits while the worst results are in employment techniques.
The previous WB report, "Doing Business 2007" applauded Romania for the changes in the business sector and classified the country among the top ten reforming states. However, this year's edition, Romania is not taken into consideration from this perspective.
As positive examples, countries like Egypt, Croatia, Ghana, Georgia or Columbia and Bulgaria are listed.
by costi.boroda@mxp.ro, 25.09.2007

Number of Romania registered new cars up 29.2 percent
The number of newly registered cars in Romania grew to 209,138 in the first eight months of the year, up 29.2% compared to the similar period last year, according to the Association of European Automobile Manufacturers Association.
A total of 10,023,580 new cars were reported at European level during the same period, up 1% compared to January-August 2006.
The number of new car registrations grew 7.3% in Italy, 4.9% in Britain and remained almost unchanged in France. Meanwhile, the German market fell 7.6% and the Spanish market - 1.5%.
Best sales were reported by VOLKSWAGEN with 2,139,866 units, followed by PSA, PEUGEOT, CITROEN and FORD. The RENAULT Group to which Romanian car maker DACIA belongs comes fifth with 936,003 cars sold.
by costi.boroda@mxp.ro, 21.09.2007

BCR: The Romanian economy, attractive in terms of risk/performance ratio
The Romanian economy is one of the most attractive in the region in terms of risk/performance ratio, the Executive President of the Romanian Commercial Bank (BCR), Nicolae DANILA declared yesterday, at a seminar on economic themes, according to Rompres.
BCR estimates that Romania will have in the period 2007-2009 an annual average economic growth of 6%, concurrently with the enhancement of the current account deficit to 14%, for each of the next two years, according to the official of the bank.
The economic development rate has slowed down in the first half of the year by almost two percentage points against the annual growth from 2006, of 7.7%. GDP increased in H1 of this year, against the same period of 2006, by 5.8% in real terms, compared to 7.4% in the same period of 2006.
By mid September, the National Forecasting Commission (CNP) revised downward the estimate regarding the economic growth by 0.4 points this year, to 6.1%, and has reevaluated upward by 0.2 points, to 6.5%, the advance of GDP in 2008.
BCR's forecasting regarding the deficit of the consolidated budget points to a high level for the aforementioned interval, of 2.5-3% of GDP per year, very close to the maximum limit set by EU. Nicolae DANILA pointed out that the mergers and acquisitions, estimated at a total value of EUR 2.5 billion, will dominate this year in the private sector. As for privatization, BCR analysis shows that the utilities sector represents the engine of this process, while in the sector of the investments from private funds a concentration in the real estate domain is expected.
According to BCR's official, the Greenfield projects will represent main sources of foreign direct investments, concurrently with the finalization of the most important privatizations.
by costi.boroda@mxp.ro, 24.09.2007

Monetary policy interest rate remains 7%
The National Bank of Romania (BNR) decided yesterday to maintain unchanged the monetary policy interest rate, at 7% per year, after the Federal Reserves reduced the basic interest rate at the beginning of the month, while the Central European Bank maintained it unchanged, Rompres informs.
The Board of Administration (CA) also decided to exercise, through market operations, a firm control of the liquidity on the financial markets, with a view to strengthening the role of signal of the monetary policy interest rate and reducing the volatility of the interest rates on the inter-bank market.The CA decision comes after the decision of the Central European Bank, which maintained the reference interest rate at 4%, and that of the Federal Reserves - FED to reduce the reference interest rate by 0.5 percentage points, from 5.25% to 4.75% per year, in the attempt to counter the crisis of the real estate credits from the United States.
by costi.boroda@mxp.ro, 25.09.2007

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