Finance Ministry to accelerate capitalization of insurance companies
Finance Ministry is planning to accelerate the process of capitalization of insurance companies due to the processes in the financial market, informed Trend Azer Bayramov, the Deputy Minister of Finance. Authorized capital stock (CS) of insurance companies have to be raised up to 1 million Azeri manats by 2010, while in banks it should be 10 million by 2008 Azeri manats as per program of increasing of authorized capital stock, which is currently being implemented.
The Ministry is considering two variants: through transference of established schedule for raising authorized capital stock or by raising established norms for ACS but keeping the schedule as it is, informed A. Bayramov.
The new Law On Insurance will provide for minimum capital applied to banking sector, he said. the new law will establish more strict rules and the parameters applied in banking sector will also be applied to insurance sector. As a result some participators will lose their interest in insurance market. Thus some will stop their activities and the others will have to improve. If the companies decide to unify and leave the market, this will be their decision, we will not direct them he added.