Africa’s leading development finance institution, the African Development Bank (AfDB) has made a commitment to invest as much as $10.5 million in reinsurer, CICA-Re, the joint reinsurance company of member states of the Conférence Interafricaine des Marchés d’Assurances (CICA-Re).
The AfDB has signed an agreement to this effect which will see it take an FCFA6.56 billion stake (approximately EUR10 million or $10.5 million) in CICA-Re and join its board of directors.
It is expected that AfDB’s investment will strengthen the underwriting capacity of CICA-Re and contribute to the financing of its development and expansion across Africa.
Those close to the situation divulged that the investment will also bolster the company’s contribution to the development of domestic capital markets through the retention of a substantial share of locally generated reinsurance premiums. The investment will also implement CICA-Re’s environmental and social policy, consolidate its governance and risk-management framework, grow its capacity to provide technical assistance in insurance and reinsurance, and support efforts to diversify its reinsurance products.
Stefan Nalletamby, the African Development Bank Group’s director of financial sector development, in a statement said, “This operation is one of the African Development Bank’s strategic interventions to increase its contribution to the development of the African reinsurance sector through supporting strong African players like CICA-Re, which is capable of rising to international standards.”
On his part, Karim Diarassouba, chief executive officer Re, said, “This partnership with the African Development Bank is intended to strengthen the company’s financial robustness and support the growth of the joint reinsurance company’s activities, while enriching its multi-sectoral experience.”
CICA-Re is a key player in the development of the insurance and reinsurance sector. Its member countries are: Bénin, Burkina Faso, Cameroon, Congo, Côte d’Ivoire, Gabon, Mali, Niger, Central African Republic, Senegal, Chad and Togo.
The investment aligns with the AfDB’s strategic goal of deepening capital markets and promoting more robust and better integrated African financial institutions that offer more-diversified products to support the real sector.
CICA-Re is the third regional reinsurance company in which the bank has made an investment. The other two are African Reinsurance Corporation (Africa-Re), of which the bank is a founding member, and PTA Reinsurance (ZEP-RE).