Ministry of Finance Increases Paid-up Capital of SLIC to Meet UAE Authorities Regulatory Requirements

To comply with the United Arab Emirates (UAE) regulatory requirements, the Ministry of Funding (MoF) has boosted the capital paid-up of the state life assurance Corporation (SLIC) to Rs. 4.60 billion.

The Board of directors of SLIC petitioned SLIC's Finance division in August 2019 to increase its authorized share capital and paid-up capital from Rs. 5 billion to Rs. 6 billion and Rs. 4 billion Rs. 4,75 billion.

Nevertheless, in December 2019, the MoF has improved paid-in equities by enabling 300 million RS to be maintained from dividends to be announced for the budget year 2019-20 from Rs. 4 billion to Rs. 4,30 billion in December 2019.

The SLIC management asked that, as per UAE Act, pay-up capital for insured firms operating in the UAE shall not be below the equity of under 100 million Arab Emirates Dirham to raise the capital paid-up to Rs. 4,75 billion (AED).

In response to a continued decrease in the Pakistani rupee's currency rate against the UAE dirham, the SLIC notified the financial sector that the current SLIC paid-up capital fell below the statutory threshold of 100m AED.

"The improvement of Rs 4,30 billion was not enough and it is reaffirmed that the capital provided may be upgraded to Rs. 4,75 billion approved by the SLIC BoD," the records stated.

In this regard, the Finance Division has authorized the retention of Rs. 300 million to increase paid-up capital by Rs. 4,60 billion (Rs. 200 million from reserves and Rs. 100 million from the un-approved profits parable to the federal government for the year 2020-21).

SLIC works in the UAE too via its zonal office and provides Pakistani citizens living in the UAE with life insurance protection.

It is important to note that the federal government has 100% liquidity and that the federal government is the authorized forum for the approval of an increase in the authorized capital and the paid-up capital of the cooperation according to Articles 11, 12, 23, and 25 of the Renationalisation Orders 1972.