NET PROFIT OF ARMENIA’S INSURANCE COMPANIES TO REACH 2 BLN DRAMS IN 2010

ARKA
June 12, 2008

Net profit of Armenia’s insurance companies will increase by 38.6%
to 2bln drams by 2010, according to the CBA (Central Bank of Armenia)
report of possible development of insurance in Armenia in 2008-2010.

Net profit of local insurance companies totaled 743.9mln drams
last year.

According to forecasts, insurance companies will profit some 1.1bln
drams in 2008, 1.6bln drams in 2009 and about 2bln drams in 2010.

According to CBA, local insurance companies plan to give a boost to
other profits and expenditures with their annual average increase being
20% and 13% correspondingly in 2008-2010. Operation income will total
511mln drams and expenditures will amount to 1.9bln drams in 2010.

The annual growth of wages and other payments will be 33.4% in
2008-2010.

The index will reach some 885.1mln drams.

Net investment profit will increase by 33.4% in 2008-2010. The rate
will reach the notch of 885.1mln drams in 2010. The annual average
investment profit will increase by 42.4% to 543.1mln drams in 2010.

According to forecast, ROA is expected to reach 13% in 2010 against
8.7% in 2007, with ROE being 18.7% (against 13.1% in 2007).

The report is based on 2008-2010 business plans of Armenian insurance
companies.

At present, 12 insurance companies and six brokers are doing business
in Armenia. ($1- 307.26 drams).