Thanachart shores up capital
Thanachart Insurance has increased its registered capital to 4.93 billion baht from 740 million to prepare for business expansion and future business ventures, with revenue targeted to expand by 6% this year.
Managing director Perapart Meksingvee said the capital increase was the result of transferring more than 4 billion baht in retained earnings accumulated since the company was established in 1997.
The company completed the capital increase in February, which strengthened the capital adequacy ratio to 807%, above the regulator's requirement of 140%.
As a result, Thanachart Insurance has the most capital in the Thai non-life insurance industry.
"The capital increase was part of Thanachart Capital Plc's (TCAP's) restructuring of its shareholding to prepare for the future," Mr Perapart said.
At the end of February, TMB Bank entered into a non-binding memorandum of understanding (MoU) to consolidate with Thanachart Bank (TBank), in which TCAP holds a 50.96% stake, through a business transfer with an estimated transaction value of 130-140 billion baht.
Before the MoU signing, Thanachart Insurance was wholly owned by TBank. After the restructure, TCAP owns Thanachart Insurance.
"The company will continue to use the existing name and brand and will expand the customer base to over 10 million by offering products and services through the new bank [after TMB and TBank merge]," Mr Perapart said.
He said the stronger capital base will raise confidence among the company's customers, business partners and regulators. The capital increase will be used to invest in IT-related spending, artificial intelligence and data analytics to penetrate customer segments.
"The company aims for 6% year-on-year revenue growth this year or gross written premiums of 8.5 billion baht, driven by the four key strategies of customer segmentation to meet different customer standards, service innovation, distribution expansion and business partnership with strong alliances," Mr Perapart said.
In 2018, the company reported gross written premiums of 7.98 billion baht, up 6.4% year-on-year, and a net profit of 1.04 billion baht.
Thanachart Insurance remains among the top 10 non-life insurance companies by market share in Thailand.
The company is focused on retail insurance, led by motor insurance business at 85% of total revenue and with non-motor business making up the remaining 15%.