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Alinma Bank and Tokio Marine and Nichido Fire Insurance Co., Ltd. Sign Memorandum of Understanding to Establish Takaful Insurance Company

Alinma Bank and Tokio Marine and Nichido Fire Insurance Co., Ltd. Sign Memorandum of Understanding to Establish Takaful Insurance Company

16 Rabia II 1431 H - 01 April 2010 G

Alinma Bank (TASI: 1150) and Tokio Marine Holdings, Inc. of Japan have signed a strategic memorandum of understanding to establish a joint venture, composite insurance company in Saudi Arabia. Tokio Marine’s shareholding of the new company would be made through its wholly owned subsidiary, Tokio Marine & Nichido Fire Insurance Co., Ltd.

The memorandum of understanding was signed by Mr. Abdulmohsen Bin Abdulaziz Al Fares, the CEO of Alinma Bank, and Mr. Hisatu Hamada from Tokio Marine & Nichido Fire Insurance Co., Ltd.

With the recent changes to insurance regulations in the Kingdom, it became possible for Alinma to explore various options for entering the insurance market through strategic partnerships. Tokio Marine, which has operated in Saudi Arabia for several decades providing insurance services mainly to its Japanese corporate clients through its local agent, was seen by Alinma as the best strategic partner with whom make an entrée into this new market.

The commencement of operations of the new company, which would have SAR 200 million in capital, is subject to necessary approvals by the related regulatory authorities in Japan and Saudi Arabia. Alinma and Tokio Marine would hold equal shares in the new company while 30 percent of the new company’s capital would be offered for public subscription. Other strategic partners would also hold shares of the new company, including SABIC for Industrial Investment, a subsidiary of SABIC.

The new company would provide fully Shariah-compliant “Takaful” insurance services designed to cultivate the vast, untapped retail market where demand for high quality, Shariah-compliant insurance options is seen as strong. These Takaful services would be promoted and delivered mainly through Alinma Bank’s kingdom-wide branch network.

Alinma Bank is one of the largest banks in the gulf region in terms of capital. It provides a full range of Shariah-compliant retail and corporate banking services. At the core of the bank’s mission is the concept of partnership, in which clients are seen as true partners who deserve to be valued and served with the highest levels of transparency, innovation and respect.

Tokio Marine is a leader amongst global financial and insurance groups in Takaful insurance services with its “direct Takaful” operations in major markets such as Saudi Arabia, Malaysia, Indonesia and Egypt. The group also has a rated “re-Takaful” company in Singapore and carries out strategic Takaful R&D functions for the entire group through its Takaful center of excellence based in Dubai, UAE.

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