The Saudi Central Bank (SAMA) has issued a statement encouraging companies in the insurance sector to consider mergers and acquisitions. This is the latest such call by SAMA which has been promoting M&As among insurers for several years.
SAMA stressed the insurance sector’s importance to the Saudi economy, and the part it plays in the government’s Financial Sector Development Programme, reported Arab News.
SAMA cited the merger of Walaa Cooperative Insurance and Metlife AIG ANB Cooperative Insurance, and of Gulf Union National Cooperative Insurance and Al-Ahlia Insurance, as successful examples of such deals and how they helped boost the financial solvency of the companies involved by improving the insurers’ capital.
Research shows that M&As can make the sector more competitive and strengthen its financial position.
Through M&As, SAMA said it aims to improve customer service and efficiency, and reduce costs.