Kenya Re has today announced an investment income increase of 14% for the first six months of 2018. The Corporation achieved the profit before tax of Ksh 1.756 billion as at 30th June 2018 compared to 2.294 billion as at 30th June 2017, which is 23% lower. Profit after tax was Ksh 1.230 billion compared to Ksh 1.622 billion, which is 24% lower. The corporation saw a 16% drop in gross premiums written from 7.504 billion as at 30th June 2017 to Ksh. 6.332 billion as of June 30 2018. Kenya Re presented the mid-fiscal 2018 financial results at the Intercontinental Hotel Nairobi.
The Corporation attributed these results to an increase in new industry entrants in Kenya that has increased competition and caused a drop in premium growth rates in the market. Foreign exchange losses in jurisdictions that underwrite business affected the corporation resulting in increased operating expenses. Slow payment of due premiums by insurance markets resulted in outstanding debts that directly affected us as a reinsurer.
Kenya Reinsurance Corporation aims to pursue new reinsurance markets such as northern Africa, the Middle East and Asia while increasing their risk appetite in a bid to attain fruitful results in the remaining half year. The Reinsurer aims to focus on new product development in order to be more responsive to market needs. Kenya Re is taking steps to set up additional offices in efforts to beat domestication and remain ahead of the competition.
The corporation is increasing investments to help realize real-time capital gains from equity and fixed income instruments that will lean towards government securities in order to achieve a more fruitful second half year. Kenya Re prides itself in offering world-class reinsurance services and believes it is well positioned to counteract any business challenges while continuing to focus on its capital management priorities and to respond to market opportunities.
Speaking during the briefing, Kenya Re Chairman, Mr. David K. Kemei said that the Corporation has experienced its own share of challenges in 2018 however expressed that the future looks fruitful for the corporation through the implementation of its five-year strategic plan.
“In response to these challenges, the corporation has put in place various measures that will see the corporation respond to market needs with a focus on product development, increase our operations by opening new offices to deal with competition while closely following up on all outstanding returns. These activities are all in line with our five year strategic plan (2016 -2020) that has been put in place to propel the corporation on a sustained trajectory growth,” said Mr. Kemei.
The Managing Director, Kenya Re, Mr. Jadiah Mwarania, said that the year 2018 showed indicative growth improvement headroom for Kenya Re and the corporation has been able to record notable profit in investment income, the Corporation’s asset base and shareholders’ funds. He later presented the half year results.
“Investment income grew by 14% from Ksh. 1.716 billion in June 2017 to Ksh 1.940 billion in June 2018. Our asset base grew by 2% to stand at Ksh 43.614 compared to Ksh 42.741billion over the same period in 2017. Shareholders’ funds went up from Ksh 27.20 billion in December 2017 to Ksh 28.14 billion in June 2018, a reflection of 3% growth.” Mr. Mwarania expressed.
As the corporation announced their financial results, Kenya Re also expressed its plans to strengthen its flagship CSR project, the Niko Fiti na Kenya Re campaign. The insurer is confident that the upcoming legacy project will have a far-reaching positive impact not only in our country but the whole of Africa as the upcoming project. The KISE Block F which has been adopted will be the first of its kind in East and Central Africa and will serve persons living with disability from beyond Kenya.