Insurance Australia Group, the country’s largest general [P/C] insurer, said on Tuesday it had no net exposure to supply chain finance firm Greensill Capital, helping its shares recover from a sharp 10% drop earlier.
IAG said in a statement that since the sale of its 50% stake in BCC to Tokio Marine in 2019 it no longer had exposure to trade credit insurance, including policies sold by BCC to Greensill. [Editor’s note: BCC is an acronym for Bond and Credit Company, a subsidiary of Tokio Marine].
The announcement comes a day after Greensill filed for insolvency after losing insurance coverage for its debt repackaging business and said that its largest client, GFG Alliance, had started to default on its debts.
“As part of the sale IAG entered into agreements with Tokio Marine for it to hold any remaining exposure to trade credit insurance written by BCC through IAL,” IAG said.
Shares of the insurer were last down 1%. They were briefly halted before the announcement after sliding 10.2% to their lowest since November 2012 earlier in the session.
(Reporting by Nikhil Kurian Nainan in Bengaluru; editing by Subhranshu Sahu, Aditya Soni)
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