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BKIC News

Bahrain Kuwait Insurance Company B.S.C. discloses its financial results for the three months ending 31st March 2023 based on adoption of the new International Financial Reporting Standards IFRS17 and IFRS9

14/05/2023

Bahrain Kuwait Insurance Company (BKIC) B.S.C. (trading code in Bahrain Bourse “BKIC” and in Boursa Kuwait “BKIKWT”) announced its consolidated financial results for the three months ended 31st March 2023 based on adoption of two new Accounting Standards (IFRS17 and IFRS9).

Adoption of two new Accounting Standards (IFRS17 and IFRS9)

BKIC is pleased to announce that it has for the first time adopted the new International Financial Reporting Standards (IFRS) 17 and 9 as mandated by the Central Bank of Bahrain. These new standards represent a significant milestone for the company and demonstrate its commitment to transparency and compliance in financial reporting.

IFRS 9, which replaces IAS 39, sets out new rules for the classification and measurement of financials assets and liabilities, as well as new impairment models. IFRS 17, on the other hand, establishes a single accounting model for all insurance contracts, and requires insurers to provide more detailed information about their contracts. By adopting these standards, BKIC is ensuring that its financial reporting is in line with international best practices and is more transparent and comparable to that of our peers and other industries.

The financial results for the three months ended 31st March 2023 based on the new IFRS 17 and 9

The consolidated financial results presented a net profit attributable to the shareholders of the company BD 1.514 million compared to BD 1.358 million for the same period last year (reinstated), representing an increase of 11%. Earnings per share for the 1st quarter of the current year was 11 fils compared to 9 fils for the same period last year. The total comprehensive income attributable to the shareholders of the company reached BD 1.550 million in Q1-2023 compared to BD 1.029 million in Q1-2022, registering as an increase of 51%. The increase was mainly due to increasing fair value gains recorded in 1st quarter 2023 compared to the same period in 2022.

The Company achieved 21% growth in gross written premium from BD 27.232 million in the 1st quarter of last year to BD 32.957 million in the 1st quarter of the current year. Insurance revenue increased by 6% from BD 25.438 million in the 1st quarter of last year to BD 27.020 million in the 1st quarter of the current year. The Insurance service result increased by 50%, from BD 0.651 million in the 1st quarter of last year to BD 0.978 million in the 1st quarter of the current year. The Total investment income increased by 35%, from BD 0.783 million in the 1st quarter of last year to BD 1.055 million in the 1st quarter of the current year.

The increase in the net profit for the three months ended 31st March 2023 compared to the same period last year is mainly due to the improvement in both Insurance service result and investment income.

The equity attributable to the shareholders of the company as end of March 2023 is BD 40.190 million compared to BD 42.484 million as end of last year, representing a decrease of 5% mainly due to allocation towards increased shareholders’ dividends payouts. The total assets by the end of March 2023 reached BD 162.259 million compared to BD 149.875 million as end of last year, representing an increase of 8%. The net Insurance contract liabilities increased from BD 56.232 million at the end of the last year to BD 56.533 million at the end of the current period.

Board of DirectorsComments:

Upon concluding their review of the company’s results and achievements, the Board of Directors expressed their satisfaction stating: “The Board is pleased with the results for the first three months of 2023. The Board commended the efforts of the company’s management and employees in going live with 2 major projects in parallel being the Core System Go Live on 1 April 2023 and the implementation of IFRS 17 as at 1/1/2023. This is a major successful achievement for the company which the Board is very proud of.

Finally, largely due to the support and confidence of the BKIC customers, business partners and in conjunction with the strong commitment and eager dedication of both management and employees, the results continue to demonstrate both a positive and improving trend which the board is pleased with.

On this occasion, the Board would like to reiterate to its shareholders the news which was announced in April 2023regarding the potential change in the shareholding structure of the company’s Parent, Gulf Insurance Group, through the entry of its major shareholders, Kuwait Projects Company Holding (KIPCO) and FairFax Financial Holding Company Limited, into an agreement to sell the entire shares of KIPCO in the Gulf Insurance Group totaling 46.32% after obtaining the approvals of the competent regulatory authorities.”

Chief Executive Officer’s Comments:

Echoing the sentiment of the Board, BKIC’s CEO Dr. Abdulla Sultan reiterated that the company's consolidated results in the 1st quarter of 2023 are surely gratifying. Achieving both top- and bottom-line growth in unprecedented global conditions is a worthy accomplishment. In addition, witnessing improved Net Profits in all core streams of income: BKIC Bahrain, BKIC Kuwait and the Takaful International subsidiary is even more rewarding. Dr. Sultan also commended the improved Investment income in Q1-2023 and advocated the confidence that the company’s streams of income would further improve in the coming periods.”

Dr. Sultan also added “On this occasion I would like to thank the entire teams at BKIC Bahrain, BKIC Kuwait and our subsidiary Takaful International for successfully implementing the 2 major projects during the first quarter of 2023. The teams have all proved their outstanding dedication, hard-work and commitment to the company which was overwhelming.”

Group Profile

It is worth mentioning that Bahrain Kuwait Insurance Company (BKIC) is the lead insurance company in the Bahraini market rated A- (Excellent) with stable outlook, by A.M Best which is the highest rating in Bahrain to be awarded to a local direct insurer, reflecting the financial strength of the company to meet its future obligations. GIG Bahrain is a subsidiary of Gulf Insurance Group (GIG) which is the largest insurance Group in Kuwait in terms of written and retained premiums, with operations in life and non-life as well as Takaful insurance. Gulf Insurance has become one of the largest insurance networks in the Middle East and North Africa with companies in Bahrain, Kuwait, Jordan, Egypt, Turkey, Algeria, UAE, KSA, Oman, Qatar, Syria, Iraq and Lebanon.

KIPCO – Kuwait Projects Company – is Gulf Insurance Group’s largest shareholder, followed by the Canadian-based Fairfax Financial Holding Ltd.

The full set of financial statements and the press release for the period ended 31st March 2023 are available on the websites of Bahrain Bourse and Boursa Kuwait.