Romanian insurance companies Astra Asigurari, Carpatica Asig, Euroins and EximAsig have failed the Balance Sheet Review (BSR) and the stress test, and need to come up with new money to strengthen their capital base, Romania’s Financial Supervisory Authority (ASF) announced on July 15.

The four companies had an aggregate capital deficit of EUR 356 million, according to Solvency I prudential criteria. Astra Asigurari had the highest deficit, of some EUR 225 million, followed by Euroins – EUR 124 million, Carpatica Asig – EUR 92 million, and EximAsig – under EUR 1 million. Two of the companies, Astra and Carpatica, are in various stages of reorganization.

The stress tests have also revealed that five local insurers failed to reach the minimum capital requirements according to Solvency II criteria, which enter into force starting January 1, 2016. Axa joins the other four already mentioned on this list, and the total capital deficit in this case is some EUR 467 million.

Only one of the 13 insurers that went through the stress test, would meet the solvency capital requirement (SCR) in case of an earthquake, according to ASF.

Six audit firms have worked on the stress test by assessing the balance sheets of the biggest 13 insurance companies in Romania, which hold over 80% of the total market. The ASF will extend the stress tests to the other companies as well.

editor@romania-insider.com