Australia’s general insurance firm IAG has divested its entire 26% stake in SBI General Insurance, the insurance arm of Indian public sector lender SBI.

The transactions were initiated in October last year, which has now been completed.

Go deeper with GlobalData

Premium Insights

The gold standard of business intelligence.

Find out more

Related Company Profiles

View all

The Australian insurer is expected to book a net profit of approximately $310m on the sale to IAG in the second half of this year.

IAG’s capital position

Due to heavy incidence on natural perils, IAG’s Common Equity Tier 1 (CET1) ratio dropped from 1.15 on December 2019 to 1.09 by the end of February.

As of 27 March 2020, the CET1 ratio is anticipated to be range from 0.9 to 1.1.

This includes payments of an interim dividend of $231m on 25 March 2020 and completion of IAG’s stake sale in SBI.

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData
Visit our Privacy Policy for more information about our services, how we may use, process and share your personal data, including information of your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.

As a result of the sale completion, IAG has been completely exited SBI with a regulatory capital position of nearly $450m.

The March 2020 underwriting results are yet to be filed, the insurer said in a press release.

IAG’s unchanged guidance for FY2020

The insurer’s overall YTD profitability has decreased substantially due to the impact of natural peril claim costs.

However, its underlying business has shown strength in its performance.

The company’s unchanged guidance for FY2020 suggests a low single-digit GWP growth and a margin range of 12.5 to 14.5%.

At this quarter-end, IAG has incurred a $100m pre-tax loss on technical reserves investment income from widening credit spreads.

The insurer anticipates that the unrealised loss will be recovered as its securities mature.