Reinsurer seeks refuge in Botswana

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FIRST Mutual Holdings (FMH) is relocating its reinsurance business, First Mutual Reinsurance Company (FMRC), to Botswana to escape the limitations of the local operating environment, which has been fouled by a chronic currency crisis.
It comes as a worsening economic crisis in Zimbabwe, headlined by foreign currency shortages, has inhibited local reinsurers from underwriting more business, particularly in the region.

FMH shareholders approved the restructure through an extraordinary general meeting (EGM) last week, which resulted in the “subscription by Aleyo Growth Fund Partnership (a Botswana private equity firm), for a 29,1 percent shareholding in First Mutual Reinsurance Holdings (FMRe) for BWP 61 million (US$5,3), which sum shall capitalise FMRE Property & Casualty (FMPC) and FMRC,” according to a statement issued by the insurer.