OREANDA-NEWS. On June 07, 2007 the International Bank of Azerbaijan (IBA) has proposed for sells the subsidiary company of the International Insurance Company (IIC) in Zurich (Switzerland) –InterProtect Re AG reinsurance company, informed Jahangir Gadjiyev, Chairman of Board of IBA, reported the press-centre of  IBA.

InterProtect Re AG is established at 100-percent participation of IIC, which is owned solely by the International Bank of Azerbaijan.

"Decision is made due to changes in the legislation of Switzerland on increase of capital and requirements by relevant Swiss authorities for transformation of all captive companies (accepting risks only from parent companies) into real reinsurance companies. The company shall become reinsurance company until the end of 2007", - Gadjiyev exaplained.

IBA was forced to take these measures due to restrictions in the legislation of Azerbaijan on increase of capital in its subsidiary company (investments shall not exceed 20 percent of the capital of parent company).

According to Gadjiyev, the IIC capital does not allow the increase of InterProtect Re AG capital, this is not expedient, and therefore the decision is made on sell.

"I think it is going to be the successful sell, as it was appropriately assessed by the KPMG international auditor firm", - said the head of IBA.

From January 1, 2007 the charter capital for reinsurance companies in Switzerland was increased to up to 5 mln. Swiss francs (1 CHF-0.7139 manats, which total in 3,579 mln. manats), and InterProtect Re AG was established two years ago with capital of 1,2 mln. Swiss francs (about 0,857 mln. manats).

By the year start the paid charter capital of the International Insurance Company is set at 8,8 mln. manats. Accordingly, in increase of the capital of the InterProtect Re AG to the required level its share in the charter capital of IIC will be at 40,7 percent.