The Egyptian Financial Regulatory Authority (FRA) has issued a resolution, amending some provisions of a 2024 regulation, regarding the controls for granting and maintaining licences for companies operating in non-banking financial activities, including insurance.
The decision puts in place stricter controls on ownership structures, especially in the insurance sector. It ensures that there are shareholders with strong financial and credit capabilities, able to support the continuity of the insurer’s business and meet obligations towards policyholders.
The amendment stipulates that the shareholding of financial institutions or qualified investors in insurance and reinsurance companies must be at least 25% of the capital, with a minimum equity of EGP5bn ($104.8m).
The FRA requires that the institution or company owning the majority of shares have a credit rating of at least ‘A’ from one of the rating agencies licensed by the Authority, or an equivalent rating from recognised international rating agencies such as Standard & Poor's, Fitch, Moody's and AM Best.
The decision also provides for regulatory flexibility, allowing the FRA to exempt companies from the requirement to obtain a credit rating, provided that the equity of the financial institution, alone or jointly with the company that owns the majority of the shares, reaches at least EGP10bn.
The decision will take effect on the day following its publication in the Egyptian Gazette and will be posted on the FRA website.