Bulgaria’s financial regulator revokes licence of insurer DallBogg
Bulgaria’s Financial Supervision Commission (FSC) said on June 9 that it revoked the licence of Bulgarian insurance company DallBogg after it failed to address solvency concerns.
The regulator said that the solvency plan submitted by the company, which FSC requested after it found DallBogg did not comply with mandatory capital reserves regulations, was “inadequate” in addressing the solvency concerns, leaving the FSC no other option but to revoke the licence.
Additionally, DallBogg failed to implement a number of administrative orders issued by the FSC and committed “numerous gross or systemic breaches” of regulations in its operations on the EU internal insurance market, the regulator said.
DallBogg became one of Bulgaria’s largest insurers after expanding its operations in several European markets, including neighbouring Romania and Greece, but also Italy, Spain and Poland.
Last year, FSC barred DallBogg’s from any cross-border insurance activity, following decisions by Romanian and Polish insurance regulators to impose bans on DallBogg’s operations on their respective markets.
In April, FSC barred DallBogg from issuing any new insurance or re-insurance policies in Bulgaria and requested the company submit a plan to address short-term solvency concerns.
On June 9, FSC chairperson Vassil Golemanov said that the regulator found a shortfall of 280 million euro in DallBogg’s capital reserves, as quoted by Bulgarian state news agency BTA.
At the same time with the revocation of DallBogg’s licence, the regulator appointed two receivers, who will take over the management of the company, pending any appeal against FSC’s licence revocation.
Going forward, DallBogg cannot issue new insurance policies or expand coverage under existing policies, but all such policies remain valid until such a time that the insurer is declared insolvent, the regulator said.
The FSC decision did not mention DallBogg’s pension subsidiary, but reports in Bulgarian media said it would likely have to be sold because it cannot have an insolvent parent company.
(Photo of FSC headquarters in Sofia: Dbalinov/Creative Commons)
Please support independent journalism by clicking on the button below. For as little as three euro a month or the equivalent in other currencies, you can support The Sofia Globe via patreon.com and get access to exclusive subscriber-only content:
