Do not go gentle into that good night, old age should burn and rave at close of day; Rage, rage against the dying of the light, though wise men at their end know dark is right, because their words had forked no lightning they, do not go gentle into that good night.
Lotte Insurance raises W375 bil. by issuing new shares
Lotte Insurance head office in Seoul / Courtesy of Lotte Insurance
By Jhoo Dong-chan
By Jhoo Dong-chan
Lotte Insurance raised 375 billion won ($319.2 million) by issuing new stocks, the non-life insurer said Monday. The issuing price was 2,130 won per share.
It newly issued about 176 million ordinary shares worth 375 billion won on the day. Of them, JKL Partners, Lotte Insurance's largest shareholder, bought 356.25 billion won worth of shares via its subsidiary firm while Hotel Lotte also financed 18.75 billion won worth of shares to maintain its 5 percent stake.
“Lotte Insurance's risk-based capital (RBC) ratio has now reached 194.9 percent through its recent recapitalization,” a Lotte Insurance official said.
The RBC requirement refers to a rule that establishes minimum regulatory capital for financial institutions.
Lotte Insurance's RBC ratio stood at 140.1 percent in June, but managed to raise the ratio through the recapitalization, surpassing the government's minimum recommendation of 150 percent.
“Thanks to the recapitalization, Lotte Insurance will be able to withstand shocks from a series of negative developments, such as the introduction of International Financial Reporting Standards (IFRS) 17 in 2022.”
The IFRS 17, a new set of global accounting standards for insurers replacing the current IFRS 4, will require insurers to measure the liabilities of their insurance contracts by market value, not book value. It was originally scheduled to be introduced in January 2021, but last November the introduction was postponed a year to January 2022.
Private equity firm JKL Partners acquired Lotte Insurance earlier this year from Lotte Group. The firm appointed JKL senior managing director Choi Won-jin as the new head of the insurance company on Oct. 10.