Hontai Life Insurance Co (宏泰人壽) is expected to increase its risk-based capital (RBC) ratio to the legal standard of 200 percent by raising funds, Financial Supervisory Commission Chairman William Tseng (曾銘宗) said yesterday.
The RBC ratio is a measure of a company’s financial strength. Hontai Life’s current RBC ratio is between 50 and 100 percent.
The commission last week imposed an administrative sanction on Hontai Life for failing to meet the regulatory standard for RBC and for its lack of feasible plans to improve its financial structure.
However, Tseng said Hontai Life’s major shareholders — including Everpro Insurance Brokers Co Ltd (永達保險經紀人) — have sufficient funding to address the problem.
“I believe the company’s major shareholders would not allow themselves to be shamed by this issue,” Tseng said.
Hontai Life is scheduled to hold an extraordinary shareholders’ meeting today to discuss the issue. The firm said that the majority of its shareholders’ board of directors have not yet agreed to attend.
However, all shareholders have reached a consensus on raising the company’s RBC ratio to 200 percent by the end of this year, Hontai Life added.
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