New Phoenix aims high

Phoenix Metrolife Emboriki, the new entity created from the merger of Phoenix Insurance and Metrolife Emboriki, expects to generate 225 million euros in premiums this year, but said costs related to a voluntary redundancy program and coordinating the different computer systems are likely to put pressure on profits. The integrated insurance company, second in the sector in own capital and fourth in premiums, has more than 720,000 policyholders. Premiums in the first five months of the year rose by 32 percent and are expected to increase by an annualized 12-15 percent in 2003, Grigoris Fanos, the company’s business manager, said. Gross profit projected for this year is 40 million euros, and is forecast to rise by an average 22 percent next year, he said. Giorgos Kotsalos, managing director, said costs this year will be higher as a result of a voluntary redundancy program, harmonizing the computer systems and restructuring the balance sheet. The company expects 120 voluntary redundancies this year at a cost of 15 million euros. He also warned of an impending hike in auto premiums, a move necessitated by the sector’s losses and lower revenues from stock market activities. Kotsalos said the insurance industry faces a number of challenges, one being the sharp jump in costs, especially reinsurance costs. «Declining revenues from stock market operations and the State’s delay in introducing private pension funds are also creating uncertainties for insurers,» he said. In the future, said Kotsalos, Phoenix Metrolife Emboriki will focus on strengthening its core activities and will not depend on the equity markets. The merged entity will announce its listing on the Athens Stock Exchange on June 20, replacing Phoenix and Metrolife Emboriki, both of which are already listed on the exchange.

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