Romanian operations are expected to boast the highest contributions to overseas revenues generated by Austrian-based Vienna Insurance group by 2010, believes Boris Schneider, general manager of Asirom, which recently joined the group.
Vienna Insurance also owns insurance companies Omniasig, Omniasig Life, Unita and Agras, and is also the leader of the Romanian insurance market, which is expected to hit 2bn euros this year.
"At present, the Czech Republic is the group's most important country. Romania now generates 6-7% of Vienna Insurance overseas revenues, but the weight is forecast to rise to 10% or even more by 2010," states Schneider.
Vienna Insurance is Austria's biggest insurance group and in the first 9 months of the year generated turnover worth over 5bn euros, up 16.5% against the same period last year, whilst gross income stood at 324m euros, and equalled the value reached in 2006. For 2010, the group intends to reach a volume of gross underwritten premiums worth 10bn euros, which means Romanian operations should contribute at least 1bn euros to turnover.
Asirom, one of the biggest insurers on the domestic market, is the Austrian group's latest acquisition. Vienna Insurance bought 30% in Asirom in late July and 20% earlier this month, with both stakes acquired from businessman Ioan Niculae for a total of around 76m euros.
"I believe Ioan Niculae's decision to sell was very wise. It was good timing for Asirom, because operating on a highly competitive market, we'd have encountered certain problems in the future had the majority shareholder been Romanian," explains Schneider.
"He also believes a foreign financial group, such as Vienna Insurance, can offer more solid financial support to an insurer, because it pursues profit during the long term, rather than the short term, as Romanian groups do.
He believes the companies Vienna Insurance holds in Romania will continue to operate as separate entities, but synergies will be pursued.
In the first nine months of this year, Asirom was the only large company part of the group whose turnover stagnated.
The insurer ended the first three quarters with turnover worth around 144m euros, more or less unchanged against the same period in 2006, while the other two major players Vienna Insurance holds in Romania saw their turnovers almost double.
"We did not witness growth during this period as we raised rates for comprehensive car insurance, by 20% on average, to return to profit on this business line (...)," says Schneider.
Overall, he expects turnover to witness below 10% growth this year and reach a maximum 187m euros.
Asirom
n Is the Austrian group's latest acquisition
n Vienna Insurance bought 30% in Asirom in late July and 20% earlier this month, with both stakes acquired from businessman Ioan Niculae for a total of around
76m euros
n In the first 9 months of this year, Asirom was the only large company part of the group whose turnover stagnated, ending the first 3 quarters with turnover worth some
144m euros, more or less
unchanged against the same period in 2006
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