FCMC withdraws all operating licences issued to IJSC „Balva”

17.06.2013
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Riga, 17.06.2013
Press Release

FCMC withdraws all operating licences issued to IJSC „Balva” 
IJCS „Balva” to continue fulfilling obligations to their customers

Riga, June 17 — The Board of Financial and Capital Market Commission (FCMC) has decided to withdraw all the operating licences issued to the insurance joint stock company (IJSC) „Balva” in order to protect the insured persons. In accordance with the law the IJSC „Balva” has to launch the winding-up process, by appointing a liquidator and agreeing the procedure for debt covering with the FCMC, or transform the insurance company into a legal person that does not pursue insurance business. IJSC „Balva” is obliged to continue fulfilling the terms of contracts entered into with their customers.

It should be noted that on April 16 FCMC suspended the activities of IJSC „Balva” prohibiting it from entering into new insurance contracts, because of the lack of information at the FCMC disposal regarding the company’s activities in the United Kingdom. IJSC „Balva” was requested to provide the FCMC with the required information and eliminate indentified violations of the law. However, having examined the situation the FCMC came to conclusion that over the period until withdrawal of licences the company had failed to carry out the necessary improvements and the insurance company was incapable to ensure fulfilment of the regulatory requirements, i.e. the levels of provisions and capital adequate to its business volumes.

How does it affect the IJSC „Balva” customers?

At present the IJSC „Balva” has to continue ensuring fulfilment of its obligations to customers – therefore all the insurance policies are still effective. Above relates to all the insurance services offered by the IJSC „Balva”.

Following options may be provided for the procedure for covering the IJSC „Balva” debts:

• Insurance company continues to meet all insurance obligations;
• Insurance company agrees with any other insurer about taking over insurance contracts fully or partially, thus handing over fulfilment of obligations to customers to another insurer;
• Insurance company terminates insurance contracts before their expiry, except the contracts of compulsory third party liability of owners of land transport vehicles (OCTA), carrying out partial payment of insurance premiums.
 
FCMC will announce the procedure selected for the IJSC „Balva” debt covering in a separate statement.

For further information, please contact the IJSC AAS „Balva” on +371 67506955, or email balva@balva.lv

Further information:
Laima Auza
Head of Communications Division
Financial and capital Market Commission
Telephone: +371 67774860, +371 26148001
laima.auza@fktk.lv

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