Annual Report & Accounts 2018 Contents • Established in1976 • 41 African Member States ANNUAL REPORT & ACCOUNTS 2018 1 Annual Report & Accounts 2018 Contents Financial highlights In US$ ‘000 2018 2017 2016 2015 2014 Results Written Premium 797,415 746,829 642,024 689,291 717,525 Retained Premium 681,334 625,651 556,995 593,473 624,387 Earned Premium (Net) 673,554 606,896 567,532 590,820 614,445 Net Profit 31,269 87,982 100,202 103,645 118,504 Financial position Shareholders’ Funds 917,047 902,039 812,311 780,071 736,925 Total Assets 1,644,648 1,628,545 1,447,299 1,374,464 1,403,266 Results 2014 - 2018 Financial position 2014 - 2018 (in million US$) (in million US$) 800 797 1800 747 1,645 1,629 718 689 700 681 642 1500 1,447 626 624 1,403 1,374 600 593 557 1200 500 917 400 900 902 812 780 737 300 600 200 119 104 100 300 100 88 31 0 0 2018 2017 2016 2015 2014 2018 2017 2016 2015 2014 Written premium Shareholders’ funds Retained premium Total assets Net profit Proposed dividend Ratings per share A.M. Best A.M.Best A (Excellent/Stable Outlook) US$8 Standard S&P & Poor’s A- (Strong/Stable Outlook) 2 Annual Report & Accounts 2018 Contents TABLE OF CONTENTS 3 LETTER TO THE GENERAL ASSEMBLY 33 Enterprise Risk Management (ERM) 36 Corporate Governance 4 BOARD OF DIRECTORS 40 Compliance 9 EXECUTIVE MANAGEMENT 41 Corporate Social Responsibility 10 CENTRAL DIRECTORS 42 Human Resources and Compensation 12 REGIONAL DIRECTORS 45 MANAGEMENT RESPONSIBILITY 15 CHAIRMAN’S STATEMENT 46 INDEPENDENT AUDITOR REPORT 18 MANAGEMENT REPORT 49 FINANCIAL STATEMENTS 18 Economic and Trade Environment 49 Consolidated Statement of Financial Position 21 Technical Operations 50 Consolidated Statement of Profit or 22 Premium Income Loss and Other Comprehensive Income 23 Legal (compulsory) Cessions 51 Consolidated Statement of 24 Geographical Distribution Changes in Equity 25 Sectoral Distribution 52 Consolidated Statement of Cash Flows 26 Technical Expenses 53 Notes to the Financial Statements 89 Appendix: Consolidated Statement of 27 Investment Income Profit or Loss by Class of Business 27 Portfolio Performance 28 Asset Composition 28 Long Term Investments 29 Equities 29 Bonds and other Fixed Income 30 Cash & Cash Instruments 30 Other Operating Income 30 Results of the 2018 Financial Year 31 Appropriation of Results 31 Capital Management 32 Financial Strength & Capital Adequacy 1 Annual Report & Accounts 2018 African Reinsurance Corporation Annual Report & Financial Statements 31 December 2018 2 Annual Report & Accounts 2018 African Reinsurance Corporation General Assembly 41st Annual Ordinary Meeting Tunis, Tunisia 17 June 2019 Honourable Representatives, In accordance with the provisions of Articles 14 and 37 of the Agreement Establishing the African Reinsurance Corporation and Article 8 of the General Regulations of the Corporation, I have the honour, on behalf of the Board of Directors, to submit to you the Annual Report and Audited Accounts of the Corporation for the period 1 January to 31 December 2018. Please accept Honourable Representatives, the assurance of my highest consideration. HASSAN BOUBRIK Chairman of the Board of Directors and General Assembly 3 Annual Report & Accounts 2018 Board of Directors BOARD OF DIRECTORS Mr Hassan BOUBRIK Chairman Nationality: Mr BOUBRIK is currently the Chairman of the Supervisory Moroccan Authority of Insurance and Social Security in Morocco. He holds degrees in Finance and Actuarial Science and is in Constituency: charge of insurance supervision. Morocco: state and companies He previously served as Chief Executive Officer of a major Current Term ends in: finance conglomerate in Morocco and has held many June, 2020 board positions. Mr Aguinaldo JAIME Vice Chairman; Chairman of the Human Resources and Remuneration Committee Nationality: Mr JAIME is the current President of the Angolan insurance Angolan regulatory authority (ARSEG). He has also occupied the following positions in Angola: Deputy Prime Minister, Constituency: Governor of the Central Bank, Minister of Finance, President States of East and Southern of the Angolan Agency for Private Investment (ANIP), First Africa and Sudan President of the Angolan Investment Bank – Banco Angolano de Investimento (BAI), Director of the Foreign Current Term ends in: Investment Board (FIB), and Director of Planning, Studies June 2020 and Statistics of the Angolan National Insurance Company. He holds a Bachelor‘s degree from the Faculty of Law of the University of Lisbon, a Law degree from Agostinho Neto University, a Master’s in Business Administration (MBA) and a Master of Arts from the University College, London. He is presently a visiting lecturer in business administration at the Angolan Catholic University, Catholic University of Oporto and Catholic University of Rio de Janeiro. Dr Mohamed Ahmed MAAIT Director and Chairman of the Audit and Finance Committee Nationality: He is the current Minister of Finance of the Arab Republic Egyptian of Egypt. Dr MAAIT has a first degree in Insurance and Mathematics, M.Phil in Insurance, MSc and PhD in Constituency: Actuarial Science. He is presently a visiting lecturer in Egypt: state and companies different universities in Egypt, Chairman of the Egyptian Governmental Actuarial Department (EGAD) and member Current Term ends in: June 2021 of several government committees and board member of several companies in Egypt. 4 Annual Report & Accounts 2018 Board of Directors Mr Boubacar BAH Director and Member of the Human Resources and Remuneration Committee Nationality: Mr Boubacar BAH is the Director of Insurance at the Guinean Central Bank of the Republic of Guinea. He holds a Master’s degree in Law from the University of Dakar, Senegal and Constituency: a Postgraduate diploma from the Centre for Economics, States and companies of Banking and Financial studies in Paris, France. He has francophone West and Central Africa over 30 years of experience in the Central Bank of Guinea where he has held several top managerial positions Current Term ends in: June 2021 amongst others, Director of Human Resources; Director of the Banking Sector; Head of the Legal Department. Mr Hafedh GHARBI Director and Member of the Human Resources and Remuneration Committee Nationality: He is the Chairman of the General Insurance Committee Tunisian (Comité Général des Assurances), the supervisory authority of Tunisia. Mr Hafedh Gharbi has previously Constituency: served as Managing Director of Banque Tunisienne de Libya, Mauritania and Tunisia Solidarité (BTS) and Controller General of Finance. He (states and companies) holds a Master’s degree in Economics and a Postgraduate Diploma in Public Finance from the National School of Current Term ends in: Administration of Tunis. June 2021 Mr Kamel MARAMI Director and Member of the Human Resources and Remuneration Committee Nationality: Mr Marami is currently the Director of Insurance and Algerian member of the Insurance Supervisory Commission, Ministry of Finance, Algeria. Constituency: Algeria: state and 4 companies He is a professional insurer and holds degrees in Economics and Finance. Mr Marami equally has a Current Term ends in: Postgraduate degree in insurance. June 2021 5 Annual Report & Accounts 2018 Board of Directors Mr Patrick ANDRIAMBAHINY Director and Member of the Risk Management & Information Technology Governance Committee Nationality: Mr Andriambahiny is the current Chairman of the Malagasy Committee of Insurance Companies in Madagascar (CEAM) and Managing Director of Compagnie Assurances Constituency: Réassurances Omnibranches ARO – Madagascar. Anglophone West Africa (states & companies) and East and Southern He holds a Bachelor’s degree in Economic and Social Africa (companies)) Administration from Maine University in France. He also has a Master’s in Business Administration (MBA), Current Term ends in: a Postgraduate degree in Accounts and Finance June 2020 (DESCF) and a Master’s in Accounts and Finance. Mr Andriambahiny has served on the boards of several institutions in Madagascar. Mr Jean CLOUTIER Director and Chairman of the Risk Management and Information Technology Governance Committee Nationality: He is the current Chairman of Fairfax International, Canadian Executive Committee Member of Fairfax Financial Holdings Limited and Vice President of International Operations. Constituency: Mr Cloutier holds a Bachelor’s degree in Actuarial Science FAIRFAX from Laval University, Quebec City. He is a fellow of the Canadian Institute of Actuaries (FCIA) and Casualty Current Term ends in: June 2021 Actuarial Society (FCAS), fellow of the Singapore Actuarial Society and fellow of the Society of Actuaries of Thailand. Mr Mohammed KARI Director and Member of the Risk Management and Information Technology Governance Committee Nationality: Currently, the Commissioner for Insurance and Chief Nigerian Executive Officer of the National Insurance Commission (NAICOM), the insurance supervisory and regulatory Constituency: authority in Nigeria. Nigeria: state and companies Mr Kari is a Chartered Insurer with over 36 years of Current Term ends in: experience in insurance and management, stretching from June 2021 the private to the public sectors, where he has managed some of the biggest insurance institutions in Nigeria. He was appointed Deputy Commissioner for Insurance in charge of technical operations, NAICOM, in April 2014, a position he held until 31 July 2015 when he was appointed substantive Commissioner for Insurance. 6 Annual Report & Accounts 2018 Board of Directors Mr Coenraad Christiaan VROLIJK