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Company News

UPDATE 1-Brazil's IRB still needs to plug 1.2 bln reais liquidity gap, says CEO

(Adds IRB executive’s comments)

SAO PAULO, Aug 31 (Reuters) - Brazil’s largest reinsurer, IRB Brasil Resseguros SA, has concluded a 2.3 billion reais ($420 million) capital increase to address liquidity issues, but has not yet fully met regulatory requirements, its interim chief executive said on Monday.

Antônio Cássio dos Santos told analysts in a conference call that the company was still 1.2 billion reais short of addressing its liquidity needs. The reinsurer is working to sell some assets to meet liquidity requirements, he said, ruling out a new capital increase.

Earlier this year, IRB was investigated by the country’s insurance regulator for potential liquidity problems, as it fell short of assets to cover technical provisions. It blamed the real’s steep decline against the dollar and higher provisions in the first three months of 2020.

Shares in IRB were down around 4% in early afternoon trading after the company on the weekend reported a second-quarter net loss of 685 million reais.

$1 = 5.47 reais Reporting by Aluisio Alves; Additional reporting by Jamie McGeever; Writing by Carolina Mandl; Editing by Louise Heavens and Peter Cooney

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