-->
Sharechat Logo

CBL's European subsidiary fights Irish central bank ban on new business

Tuesday 20th February 2018

Text too small?

Insurer CBL Corp says its European subsidiary's lawyers are opposing an order from the Central Bank of Ireland instructing it to stop writing new business immediately.

CBL, whose shares are suspended from the NZX as the stockmarket operator investigates concerns over its continuous disclosure obligations, said its subsidiary CBL Insurance Europe Dac (CBLIE) is continuing to otherwise operate normally and existing policies continue to remain in force. The Irish central bank has also required CBLIE to write to all appointed insurance brokers and distribution partners to inform them of the direction and to inform policyholders, it said.

"CBLIE has sought legal advice in Europe and has instructed its European legal counsel to request the CBI to withdraw this direction," the company said. "Failing this, CBLIE reserves its rights to take any action it deems necessary in order to protect its interests."

Trading in the stock was halted before the suspension, with details eked out over subsequent days that prudential regulators in New Zealand and abroad questioned the adequacy of reserves for its French construction insurance division, prompting a credit rating downgrade and prospective capital raise.

Last week, the company said it would hire advisers to sell the French construction insurance division that's seen it fall foul of regulators over solvency concerns, and is pursuing legal action against the vendors of the business. As part of that decision, it will stop writing new French construction business from April and all renewals will end from June.

CBL gave no update today on its plans for a capital raising, which will raise cash to fund a mandated increase to its reserves from the Reserve Bank of New Zealand and CBI. 

The share last traded at $3.17 on the NZX before they were halted. 

(BusinessDesk)

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comment:
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

MARKET CLOSE: NZ shares gain; a2 jumps to 12-month high as earnings outperform
NZ dollar drifts lower following early boost from rising dairy prices
Meridian positions for next generation development
Kiwibank lifts first-half net profit 47.6% amid rekindled growth
John Fellet: Came to Sky TV for 18 months, stayed 28 years
Marsden Maritime net profit down on lower cargo through Northport
Countdown supermarkets 1H earnings dip as digital investment continues
Fletcher open to re-entering high rise construction market
Power price spike put margin squeeze on NZ producers in Dec quarter, stats show
Tilt Renewables to raise A$260m of new equity

IRG See IRG research reports