A junior subordinated mandatory convertible debt investment of up to €10 million to HD Insurance Limited ("Hellas Direct" or the "Company"), a general insurer incorporated in Cyprus and operating in Greece and Cyprus.
This transaction supports a fast growing, tech-driven insurance company operating in Greece, where the insurance penetration ratio is one of the lowest in Europe, to scale up the Company's operations and allow it to continue offering innovative insurance products and digitalising the insurance value chain. The Bank's investment will provide the Company with adequate solvency headroom to reach the necessary scale in line with its business plan. Therefore, the funds will be used as regulatory capital, as well as for working capital and general corporate purposes.
ETI score: 64
The expected transition impact of this transaction consists of:
- Competitive Quality: the new funding will support the growth of an innovative digitally enabled insurance market player that offers pioneering products in motor and home insurance. The Project will support the Company in scaling up its operations and increasing its market share.
- Resilient Quality: the Project will provide the necessary solvency capital for the Company to fund the growing GWP it expects to underwrite and that it requires to scale up its operations, while maintaining strong operational performance.
HD INSURANCE LTD
HD Insurance Limited is a next-generation all-digital insurance company established in 2011. It operates in the non-life insurance business segment, specialising in private motor vehicle insurance and residential property insurance in Greece and Cyprus.
EBRD Finance Summary
Junior subordinated mandatory convertible debt investment of up to €10 million
Total Project Cost
- Innovative financing structures and/or instruments: the EBRD is investing in a mandatory convertible unrestricted Tier 1 capital under Solvency II, which is a novel financing instrument tailored for this investment. The investment will give Hellas Direct adequate solvency capital headroom to achieve its business plan and then target a larger capital raise in two to three years.
- Knowledge, innovation, and capacity building: the EBRD's participation supports expertise and knowledge building through an innovative financing instrument that is novel to the market as well as the regulator.
Environmental and Social Summary
Categorised FI (ESP 2019). Hellas Direct has provided evidence that it is in compliance with EBRD's Performance Requirements (PRs) 2, 4 and 9 during the environmental and social due diligence and will be required to continue to comply with these PRs. Implementation of the EBRD's E&S Risk Management Procedures for Insurance is not necessary as the client only extends personal (car and home) insurance. The client has demonstrated that it has in place adequate legal covenants to ensure compliance of its clients with national applicable environmental, social, health and safety laws as well as a functioning external grievance mechanism. Hellas Direct will submit Annual Environmental and Social Reports to the Bank. There is no GET share associated with this transaction.
Technical Cooperation and Grant Financing
Company Contact Information
+30 212 222 9999
PSD last updated
16 Apr 2021
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