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EBRD promotes Bulgaria's insurance and pensions sector
To address the growing demand for insurance and pensions services in Bulgaria, the European Bank for Reconstruction and Development (EBRD) is making a US$ 5.15 million (EUR 5.0 million) equity investment in Bulgarian Insurance and Pension (BIP), a newly established company. This investment represents 30 per cent of BIP’s capital. The remaining 70 per cent is owned by TBI Holding, a joint venture between Kardan Ltd of Israel and Deutsche Bank Private Equity, with whom the EBRD are investing for the first time.
"This is the first EBRD’s investment in the Bulgarian insurance sector and also the first investment in a voluntary pension fund management company," said Jonathan Woollett, the Director for Non-banking Financial Institutions at the EBRD. "The EBRD’s investment in BIP will support the development of the Bulgarian insurance sector and involve the Bank at an early stage in the country’s pension reforms".
BIP will invest in and manage insurance and pension fund management companies and health insurance funds in Bulgaria. It will initially hold controlling stakes in Pension Assurance Company Doverie and Bulstrad Insurance and Reinsurance Plc, and in the future will seek to expand its operations in the Bulgarian insurance and pension markets.
Until 1989, there were only two insurance companies in Bulgaria, the State Insurance Institute (DZI) and Bulstrad. After the abolition of the state monopoly, more than 100 private insurance companies were set up by 1995. The country’s insurance market is highly concentrated, with the three largest insurance companies, Bulstrad, DZI and Allianz-Bulgaria, controlling more than 70 per cent of the market.
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