Kurnia Group
RM400 Million Capital Injection Poised to Strengthen Kurnia Asia
October 6th, 2008
Petaling Jaya, 6 October 2008 - Kurnia Asia Berhad (KAB) announced a RM 400
million capital injection to strengthen its capital to RM 600 million.
"With the additional capital injection, we are very well positioned and confident
of the future ahead of us. Our key aspiration is to further fortify our domestic
operations and network. We will also strive to enhance our commitment to our
shareholders, policy holders, agents as well as other key stakeholders. Another
critical direction is to grow and build our business through strategic expansion," commented
KAB executive chairman Tan Sri Dato' Kua Sian Kooi.
The company also released its unaudited financial results for the fourth quarter
(Q4) and full year ended 30 June 2008 at its corporate head office, Menara
Kurnia.
The group's gross premium income improved marginally by 1.1% to RM 1.120 billion
for the financial year ended 30 June 2008 from RM 1.107 billion in the preceding
year.
Amidst the flattish growth in its gross premium, the Group recorded a net
loss of RM 301.789 million mainly due to Management's effort in strengthening
claims reserving as well as complying with Risk Based Capital (RBC) framework
on claims reserving at 75% confidence level, ahead of the same coming into
effect from 1 January 2009. This in turn, resulted in the increase in technical
reserves to RM 1.881 billion, representing a technical reserve on net premium
written ratio of 186%, the highest reserve in the market. Another factor that
weighed down the group's financial performance was the significantly reduced
total investment income to RM 93.172 million (2007: RM182.000 million) due
to poor stock market performance.
KAB executive chairman Tan Sri Kua further added: "Despite the results reported
today and the current market volatility, Kurnia is fully committed to Malaysia
and the insurance business for the long term."
"Our internal transformation and revitalization program (Transformation of
Operations and Performance - TOP) aimed at enhancing productivity and profitability
has been running for a year and a half. We are already starting to reap some
remarkable results in our operations resulting from the five critical pillars
of transformation comprising organization leadership; growth in non motor sectors;
distribution; underwriting and claims."
"Related to this initiative, we have also strengthened and expanded our senior
management team with highly experienced and competent talents from strategically
relevant areas within the insurance sector."
"All in all, we look forward to sharing a positive growth story in the current
financial year," Tan Sri concluded