“SALAMA” Islamic Arab Insurance Co. (IAIC), the largest Islamic insurance (takaful and retakaful) operator in the world, has disclosed profits of AED 150 million for 2007. This was revealed in a disclosure made by the company to the Dubai Financial Market today.
SALAMA also disclosed that its takaful premium revenue reached at AED 930 at the end of 2007 compared to AED 657 million at the end of 2006, an increase of AED 273 million representing 41% jump over 2006 revenue.
Sheikh Khalid Bin Zayed Bin Sagr Al-Nahayan, Chairman of SALAMA commented: “Our company has presented a distinguished performance since its shares were listed for trade on the Dubai stock exchange one year ago. The remarkable success was not limited only to the launch of the first IPO, but we have also attained an A- Rating from one of the well distinguished and insurance focused agencies, AM BEST. We have also fully acquired the total equity of BEST Re, the largest re-takaful company in the world. These steps have contributed to expanding our geographic presence to include North Africa, especially Egypt, Algeria, Senegal and Tunisia” and last but not least Saudi Arabia where the IPO for Saudi Salama has been very successful and the company finally resumed its operations”.
From his perspective, Dr. Saleh Malaikah, the Vice Chairman and CEO of SALAMA said: “We have been blessed by Allah to obtain distinguished results for the last two years due to the company’s operational and balanced investment portfolios. We have invested during the past period in establishing new companies such as Saudi Salama and adding family takaful activities (life insurance) in UAE, Algeria, and the Senegal.
Malaikah, the Chairman of Salama KSA, added: “Saudi Salama will contribute toward increasing SALAMA UAE profits gradually and significantly. We expect strong growth during next year and following years. Based on the company’s ambitious expansion plans, we have now twelve branches in Saudi Arabia and preparing to open few more new branches during the next few months. We have also added medical insurance to our operations after having obtained a license from the Saudi Cooperative Council for health Insurance."
Dr. Malaikah attributed the shortfall in profits by 14% from what was achieved in 2006 to two reasons, namely non-recurrent capital gains on the investment portfolio during 2006 and the impact of the unusual number of catastrophic events in 2007 on BEST Re, the major subsidiary of SALAMA. He added “Yet, we have maintained our operational profits at almost the same level of 2006. In 2007 operational profits were AED 108 million compared to AED 109 in 2006. Had it not been for the compensation that our subsidiary BEST Re had to pay out we would have achieved yet another record profits in 2007”.
SALAMA expects substantial growth during the next five years in the global takaful and re-takaful industry to reach US$ 7.5 to 10 billion, making it one of the fastest growing sectors of the financial services industry.
Dr. Malaikah explained: “We shall focus our efforts during the current year on the diversification of list of services through medical takaful and family takaful in all markets where we operate, to position ourselves to take advantage of the growing available opportunities in the global markets. We have already started family and health takaful operations not only in the UAE but also in Algeria through the Algerian SALAMA subsidiary. Also Saudi Salama has added health takaful to its activities in Saudi Arabia. Last but not least, a subsidiary has been set up in the Senegal to offer family takaful. This company is in addition to SOSAR which is also a subsidiary in the Senegal. We have also contributed towards raising the capital the Jordanian Islamic Insurance Co, a joint-stock company whose shares are traded in the Amman stock exchange, and from its capital SALAMA owns 15% . The company recently increase its capital by 100% to JOD 8 million.
SALAMA was listed on the Dubai stock exchange in September last year, which allowed raising the company’s paid capital to one billion dirham. SALAMA now includes under its umbrella six takaful companies that provide their services in 70 countries around the globe through Tunisia-based BEST Re which is the largest re-takaful company in the Islamic world. SALAMA acquired full ownership of BEST Re at the beginning of 2006 whose paid up capital is US$ 100 million.