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Reliance Insurance secured a record profit in 2024, supported by higher premium income and investment return, in a challenging business climate.
The insurer's profit jumped 39 per cent year-on-year to Tk 959 million in 2024, the highest since its listing in the stock market in 1995.
Accordingly, its earnings per share rose to Tk 9.12 in 2024 from Tk 6.56 the year before.
Based on the profit growth, the company declared a 30 per cent cash dividend for 2024, meaning investors will receive Tk 3.0 per share from the company's income of Tk 9.12 each share.
The dividend yield is 5.15 per cent for the year, highest since 2019, when the yield was 5.75 per cent.
The growth was achieved at a time when the country's economic indicators have been showing signs of gloom.
Reliance Insurance's commitment to innovation and operating efficiency helped it stay on a strong growth trajectory, said company secretary Mohammad Mamunur Rashid.
"Higher premium income coupled with increased investment return amid rising interest rate helped secure record profit," he added.
Financial performance of the company has remained consistently good on the back of its adherence to the insurance underwriting, which earned clients' trust.
"That's why the company has been able to ensure good returns to its shareholders," said Mr Rashid.
The insurer is yet to disclose details of audited financial statements for 2024, such as gross premium income and investment income.
In the nine months through September last year, its gross premium grew 6 per cent year-on-year to Tk 1.09 billion while investment income soared 46 per cent year-on-year to Tk 454 million.
In Bangladesh, general insurance companies do business mainly in three segments -- fire, transport and marine.
Industry insiders say the persistent macroeconomic challenges and runaway inflation hit the general insurers' business but higher investment income helped profit grow.
As the bank interest rate increased, the income of insurance companies having cash surplus is growing.
The Bangladesh Bank (BB) removed the interest rate cap and replaced it with a market-driven reference rate in May last year, which drove bank deposit rate higher.
Reliance Insurance is one of the leading general insurers, providing insurance coverage for fire, marine cargo, marine hull, engineering, personal accident, overseas medical claims, motor vehicles etc.
It is focused on providing professional quality services to its clientele, which include many large national and multinational conglomerates.
Reliance Insurance has a high claim settlement ratio -- 98 per cent, exceeding industry benchmarks.
It has also been extending its research & development work to develop crop insurance products at the micro insurance level since 2022 and find the viability in the context of adverse weather events in Bangladesh due to global warming.
The general insurer will hold an annual general meeting (AGM) on March 25 while the record date is March 3.
Following the earnings disclosure, the stock rose 1.39 per cent to Tk 58.2 per share on Tuesday on the Dhaka Stock Exchange.
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