Karnaphuli Insurance financial analysis: combined ratio 82.2% in 2025 as cession rose (Oct 2026)

Investment considerations: 2025 combined ratio 82.2%, EPS Tk 2.13, nine-month 2026 EPS Tk 2.20

What it is. Karnaphuli Insurance PLC (DSE: KARNAPHULI) is a Dhaka general insurer incorporated on 23 November 1986, writing fire, marine, motor and miscellaneous business through 31 branches [1 p.169]. The name changed from Karnaphuli Insurance Company Limited with effect from 14 January 2025 [7]. It has 44,876,113 shares of Tk 10 [1 p.154]. Sponsors hold 32.74%, financial institutions 4.63% and the general public 62.63% [1 p.177]. Its registered office is the 'Meghna Life-Karnaphuli Bima Bhaban' in Motijheel [1 p.169], and Meghna Life Insurance PLC holds 4,253,056 shares (9.48%) and sits on the board through a representative director [1 p.98].

Where it stands. Gross premium was Tk 718.0m in 2025, up 7.7% on Tk 666.4m (our derivation; the management discussion prints 7.04%) [1 p.181] [1 p.105] [11]. Net premium fell 7.0% to Tk 431.7m, as premium ceded to reinsurers rose from Tk 202.5m to Tk 286.3m [1 p.181] [11]. Underwriting profit was Tk 70.2m against Tk 71.3m, and profit after tax was Tk 95.8m (EPS Tk 2.13) against a restated Tk 96.5m (EPS Tk 2.15) [1 p.181] [1 p.182]. On one combined-ratio definition used for every insurer in this note, the 2025 ratio was 82.2%, against 77.0% in 2024 [11]. For the first half of 2026 the company reported profit after tax of Tk 64.6m against Tk 49.7m [3 p.2], and DSE-announced nine-month EPS was Tk 2.20 against Tk 1.72 [7]. The shares closed at Tk 52.0 on 29-Oct-2026, against Tk 30.2 a year earlier [6] [11].

What drives shareholder returns. Karnaphuli earns from two sources of roughly equal size. Underwriting profit was Tk 70.2m in 2025 and 54.1% of pre-tax profit; investment income was Tk 77.1m and 59.4% of pre-tax profit, with Tk 17.5m of unallocated management expenses deducted below [2 p.10] [1 p.26] [1 p.181] [11]. Interest on fixed deposits (Tk 57.1m) and treasury bonds (Tk 13.7m) supplied most of the investment line [1 p.180]. Equity was 50.8% of total assets at end-2025 and net premium 0.40 times equity (derived equity) [11]. Capital allocation is plain: no debt, a 10% cash dividend (46.9% of 2025 EPS), an appropriation to the reserve for exceptional losses of Tk 43.2m and Tk 5.0m to the general reserve [1 p.181] [11]. Return on average equity was 9.2% in 2025 and ranged from 6.3% (2019) to 12.2% (2021) over 2018-2025 (derived equity) [11].

• Retention after the 2025 rise in reinsurance cession. Signpost: premium ceded and net premium in the FY2026 annual report (board meeting inferred late April 2027 from the 30-Apr-2025 and 23-Apr-2026 precedents; no date notified). H1 2026 retention was 67.8% (derived).
• Agency commission after 1-Jan-2026. Signpost: the agency-commission line in the FY2026 revenue accounts; the H1 2026 expense note shows no agency-commission line.
• Settlement of the SBC claim recoverable. Signpost: note 3.01 in the FY2026 accounts (Tk 922.7m gross at end-2025; Tk 100.7m paid by SBC 'upto 2025').
• Tax appeals. Signpost: note 4.01 and note 15.01 in the FY2026 accounts (advance tax Tk 480.0m, provision Tk 446.6m at end-2025).
• Management expenses against the IDRA limit. Signpost: any disclosure in the FY2026 notes; the 2025 report gives management expenses as 28.18% of gross premium and no comparison with the limit.

Business: fire 50.3% of 2025 gross premium, marine 31.6%, miscellaneous 14.8%, motor 3.3%

How it makes money. A Bangladeshi general insurer collects premium, cedes part of each risk to reinsurers (who pay a commission back), sets aside a reserve for the unexpired part of each policy, and pays claims, agency commission and management expenses from the rest. Karnaphuli reserves 40% of the year's net premium for fire and motor, 50% for marine cargo and miscellaneous, and 100% for marine hull [1 p.171]. The four class revenue accounts add up to the underwriting profit, and interest, dividends and other income less unallocated expenses give the pre-tax profit [1 p.181]. The 2025 gross premium of Tk 718.0m includes public-sector business of Tk 108.6m; public-sector business 'upto June 2025' was accounted for on the basis of statements received from SBC [1 p.171].

Classes. Fire is the largest class: Tk 361.2m of gross premium in 2025, 50.3% of the total, of which the company kept 60.3% after reinsurance [1 p.181] [11]. Marine wrote Tk 227.0m (31.6%) and kept 65.9%; the marine account splits into cargo and hull, with hull premium after reinsurance of only Tk 2.1m [1 p.161] [11]. Miscellaneous wrote Tk 106.4m (14.8%) and kept 40.3%, and motor wrote Tk 23.4m (3.3%) and kept 91.2% [1 p.181] [11]. Management expenses are spread across the classes in fixed shares 'as per management decision': 54.62% to fire, 30.60% to marine, 3.45% to motor and 11.33% to miscellaneous [1 p.170].

Reinsurance and SBC. Premium ceded was Tk 286.3m in 2025, 39.9% of gross premium against 30.4% in 2024, and reinsurance commission including profit commission was Tk 65.4m, 22.8% of the premium ceded [1 p.181] [11]. The company states it mitigates underwriting exposure 'through appropriate reinsurance arrangements with Sadharan Bima Corporation (SBC) and foreign reinsurers' [1 p.107]. The balance with SBC is large on both sides: note 3 shows Tk 922.7m of 'S.B.C. (Claim paid against Re-Insurance)' and Tk 241.4m of co-insurance premium on government business receivable, against Tk 1,082.9m due to SBC for reinsurance, which is netted off to leave Tk 86.9m due from other insurers on the balance sheet [1 p.174]. The Tk 922.7m is Tk 1,023.4m less Tk 100.7m 'paid by S.B.C upto 2025', the same paid amount as a year earlier [1 p.174].

Nine years of premium. Gross premium rose in every year from 2018 to 2025, from Tk 306.2m in 2017 to Tk 718.0m in 2025, a compound 11.2% a year (our derivation) [2 p.10] [1 p.26]. Annual growth ranged from 5.5% (2023) to 23.8% (2020) [11]. Net premium did not follow every year: it fell 5.6% in 2018 and 7.0% in 2025, and rose 47.6% in 2020 [11]. Retention ranged from 47.9% (2018) to 69.6% (2024) [11]. The management discussion compares the company's Tk 718.00m of gross premium with an 'Industry Average' figure of 64,259 and its Tk 186.21m of gross claims paid with 46,788, without stating the unit of the industry figures [1 p.106].

Underwriting: 2025 profit Tk 70.2m, claims ratio 27.4%, expense ratio 54.7% of net premium

Claims. Net claims were Tk 118.4m in 2025 against Tk 126.9m in 2024 [1 p.182]. The company settled Tk 186.2m of gross claims, recovered Tk 58.5m from reinsurers, and outstanding claims fell from Tk 125.8m to Tk 116.5m [1 p.182]. Fire accounted for Tk 154.2m of the gross claims settled and Tk 57.6m of the recoveries; fire outstanding claims fell from Tk 93.4m to Tk 63.7m, while marine outstanding claims rose from Tk 26.9m to Tk 38.3m [1 p.182] [1 p.177]. Reinsurance recoveries were 31.4% of gross claims settled in 2025 against 43.3% in 2024 [11]. On net premium, the claims ratio was 27.4% in 2025 and 27.3% in 2024 [11].

By class. Fire net claims were Tk 66.9m, 30.7% of fire net premium, against Tk 94.3m (39.5%) in 2024; fire underwriting profit rose to Tk 33.2m from Tk 9.6m [1 p.181] [1 p.158] [11]. Marine net claims rose to Tk 28.6m from Tk 17.5m and marine profit fell to Tk 33.2m from Tk 57.6m [1 p.160] [11]. Motor and miscellaneous are reported in one revenue account: together they made Tk 3.8m against Tk 4.1m; motor alone made a loss of Tk 0.4m, with net motor claims of Tk 11.1m on Tk 21.4m of net premium [1 p.162] [11]. The auditor's second key audit matter covers the outstanding-claims estimate (quoted in the balance-sheet section) [1 p.149].

Expenses. Management expenses charged to the revenue accounts were Tk 202.3m in 2025 (+7.2%), which the notes give as 'approximately 28.18% of gross premium' [1 p.170] [1 p.181]. Agency commission was Tk 99.4m, 13.8% of gross premium, against Tk 83.8m (12.6%) in 2024 [1 p.181] [11]. Together they were 42.0% of gross premium against 40.9% [11]. A further Tk 17.5m of management expenses sits in the profit and loss account, including Tk 9.3m of depreciation and Tk 4.8m of right-of-use depreciation [1 p.156]. The annual report gives no comparison between management expenses and the IDRA allowable limit; the auditor's legal-requirements section states that 'all expenses of management wherever incurred ... have been duly debited to the Revenue Accounts of the Company' [1 p.152].

Combined ratio. We use one definition for Karnaphuli and each peer: net claims plus management expenses (including insurance stamps where a company prints them separately) plus agency commission, less reinsurance commission including profit commission, all over net premium. Karnaphuli prints no separate stamp line in its revenue accounts. On that basis the combined ratio was 82.2% in 2025 and 77.0% in 2024 [11]. The claims ratio was almost unchanged (27.4% against 27.3%); the expense ratio rose from 49.6% to 54.7% [11]. Net premium fell by Tk 32.2m while management expenses rose by Tk 13.5m and agency commission by Tk 15.5m [1 p.181] [11]. The definition differs from the underwriting margin, which also includes the change in the unexpired-risk reserve: a Tk 6.8m charge in 2025 against Tk 35.6m in 2024 [1 p.181].

Investments: interest income Tk 72.1m in 2025, up 33.6%; Meghna Life is 64.8% of listed shares at market

The portfolio. At end-2025 Karnaphuli held Tk 755.6m of fixed deposits '313 numbers maintained with 40 banks and 7 NBFI', Tk 118.4m in CD and STD accounts, Tk 154.0m of Bangladesh Government treasury bonds held with Bangladesh Bank as the statutory deposit, and Tk 227.7m of shares, unit funds, a debenture, pre-IPO shares and an investment in 'ACAML' [1 p.176] [1 p.172]. The report gives no bank-by-bank list of the fixed deposits. The company's own 'Total Investment' figure was Tk 1,255.6m [1 p.26].

Income. Interest income rose 33.6% to Tk 72.1m: FDR interest Tk 57.1m (from Tk 43.0m), treasury-bond interest Tk 13.7m (from Tk 9.7m) and STD interest Tk 1.3m [1 p.180] [11]. Dividend income fell to Tk 6.3m from Tk 8.2m, and share sales produced a loss of Tk 1.3m against a gain of Tk 0.1m [1 p.180]. FDR interest was 7.7% of the average FDR balance and bond interest 9.2% of the average bond balance (our derivations) [11]. The notes state that 'interest on FDRs and Bonds are recognised on cash basis rather than accruals basis', so interest earned but not yet received at year-end is not in the figures [1 p.180]. Investment income on the company's highlights basis was Tk 77.1m, the highest of 2017-2025; the previous high was Tk 63.1m in 2018 [2 p.10] [1 p.26].

Shares. The share portfolio in note 2.01 lists 52 holdings with a cost of Tk 183.8m and a market value of Tk 186.4m [1 p.173]. The largest is 2,431,218 shares of Meghna Life Insurance, at a cost of Tk 98.1m and a market value of Tk 120.8m, 64.8% of the market value of the listed portfolio [1 p.173] [11]. The next largest is 2,010,000 units of MTB Unit Fund at Tk 21.0m [1 p.173]. Seven holdings show no market value [1 p.173]. Unit funds (ICB Islamic Unit Fund and Sandhani Life Unit Fund) cost Tk 21.8m and had a market value of Tk 15.6m [1 p.174]. Pre-IPO placements total Tk 11.3m, including Tk 4.0m in GMG Airlines, which 'The Board has decided to Write Off ... at an annual rate of 10% starting from 2024' [1 p.174].

A change of method in 2025. From 2025 the company measures shares and unit funds at fair value through other comprehensive income and restated 2024: the note states that 'The management has decided to recognise the investment in share, debentures and bonds at FVOCI model (through Profit or Loss Appropriation Account) as per IFRS 9 and IAS 39 from 2025' [1 p.172]. The net unrealised position moved from a gain of Tk 16.8m at end-2024 to a loss of Tk 3.6m at end-2025, a Tk 20.4m change recorded below profit [1 p.174]. The same restatement and a deferred-tax correction changed 2024 EPS to Tk 2.15 (restated) and NAV per share to Tk 23.12 (restated) from Tk 22.75 [1 p.183] [7]. Note xx(iii) still reads 'Investments in shares have been shown at cost' [1 p.172].

Ratios 2017-2025: ROE 9.2% in 2025 within a 6.3%-12.2% range; solvency cover 3.23 times

Returns. Return on average equity was 9.2% in 2025, against 9.7% in 2024; across 2018-2025 it ranged from 6.3% (2019) to 12.2% (2021) [11]. Equity here is NAV per share times shares (our derivation), because the highlights table prints NAV per share but not total equity [2 p.10] [1 p.26]. Return on average assets was 4.7%, within a 3.6%-6.7% range [11]. The underwriting margin (underwriting profit over net premium) was 16.3% in 2025; it ranged from 15.4% (2024) to 28.0% (2021) over 2017-2025 [11]. Profit after tax is struck before the reserve for exceptional losses, which took Tk 43.2m in 2025 and is the company's entitlement 'up to 10% of premium income' under the income-tax schedule [1 p.171] [1 p.181].

Leverage and liquidity. Equity fell from 62.4% of total assets in 2017 to 50.8% in 2025, while net premium rose from 0.20 to 0.40 times equity [11]. Fixed deposits were 35.9% of total assets in 2025, the lowest share of the series; the highest was 44.8% in 2017 [11]. The company has no borrowings [1 p.185]. Investment income was 6.8% of year-end fixed deposits plus bonds, shares and unit funds in 2025, against a 5.2%-9.1% range (our derivation, year-end base) [11].

Cash conversion. Net operating cash flow was Tk 112.1m in 2025 (NOCFPS Tk 2.50) against Tk 130.7m in 2024 (Tk 2.91) [1 p.165]. The reconciliation shows a Tk 56.0m rise in premium deposits and a Tk 51.7m rise in the amount due from other insurers in 2025 [1 p.184]. Investing used Tk 23.1m, including Tk 10.0m of treasury bonds and Tk 10.4m of fixed assets, and Tk 44.9m went on the dividend [1 p.165]. Cash and bank balances rose by Tk 44.1m to Tk 876.9m [1 p.165]. NOCFPS was above EPS in both 2024 and 2025 [1 p.165] [1 p.182].

Solvency. The available solvency margin was Tk 562.9m against a required Tk 174.3m at end-2025, 3.23 times; the company's own ratio page prints 3.22 (562.87 / 174.28) and 2.70 for 2024 [1 p.26] [1 p.28] [11]. Across 2017-2025 the cover ranged from 2.71 times (2024, our arithmetic) to 5.12 times (2018) [11]. The 2024 available margin of Tk 504.4m was lower than the Tk 620.6m of 2023 [1 p.26]; the report gives no breakdown of the calculation.

Tax. Profit after tax was 73.8% of pre-tax profit in 2025 and 81.0% in 2024, on the highlights figures [11]. The 2025 charge comprised a current provision of Tk 31.4m and deferred tax of Tk 2.7m [1 p.182]. The provision note states it was made 'with due consideration of reserve after exceptional loss and concessional rate of income tax on dividend income' [1 p.178].

Peers 2025: combined ratio 82.2% at Karnaphuli, 75.5% at City Insurance, 76.9% at Asia Insurance

We compare Karnaphuli with two listed general insurers using each company's own 2025 revenue account and one combined-ratio definition. We read each auditor's opinion first. City Insurance's auditor states that the financial statements 'present fairly, in all material respects' [4 p.386]. Asia Insurance's auditor states that they 'give a true and fair view, in all material respects' and adds an emphasis of matter on 'the Company's accounting treatment for cover notes converted into policies (CCP) under insurance business and the related prior period error'; it states 'Our opinion is not modified in respect of this matter' [5 p.167]. Karnaphuli's auditor's report has no emphasis-of-matter paragraph [1 p.148] [1 p.151].

What the table shows. Among the three, Karnaphuli had the highest combined ratio (82.2%) and the lowest underwriting profit relative to net premium (16.3%, against 22.6% at City and 24.2% at Asia) [11]. Its claims ratio of 27.4% sat between City's 22.2% and Asia's 31.2% [11]. Its expense ratio of 54.7% was the highest of the three, against 53.2% at City and 45.6% at Asia [11]. The gap to City was 6.7pp on the combined ratio and 1.5pp on the expense ratio; the gap to Asia was 5.3pp and 9.1pp [11].

Labels and basis. The printed labels differ. Karnaphuli's revenue accounts print 'Expenses of Management' and 'Claims under policies Less re-insurance' and no stamp line [1 p.158]. City prints 'Management expenses' (Tk 250.8m) and 'Insurance stamp expenses' (Tk 3.6m) separately, and 'Commission earned/accepted on re-insurance ceded' (Tk 62.8m) and 'Profit commission' (Tk 8.8m) separately [4 p.394]. Asia prints 'Expenses of Management' (Tk 170.2m), 'Insurance Stamp Consumption' (Tk 2.6m), 'Commission on re-insurance ceded' (Tk 44.4m) and 'Profit Commission' (Tk 3.6m) [5 p.178]. We add stamps to management expenses and profit commission to reinsurance commission for City and Asia. Unexpired-risk reserve rates are the same at City and Karnaphuli (40% fire and motor, 50% marine cargo and miscellaneous, 100% hull) [4 p.394] [1 p.171]. Asia's 2025 accounts include the restatement for cover notes converted into policies [5 p.167]. All three figures are for calendar 2025, company basis.

Balance sheet: no debt, Tk 876.9m cash and deposits, Tk 922.7m gross SBC claim recoverable, unmodified audit

Layout. The balance sheet carries fixed assets at cost (Tk 248.2m) on the asset side and the accumulated depreciation as a 'Depreciation Fund Account' (Tk 103.7m) on the other side; the written-down value in the fixed-asset schedule is Tk 144.4m [1 p.155] [1 p.154] [1 p.167]. Premium deposits, 'premium received against cover notes for which policies had not been issued', rose 79.1% to Tk 126.9m [1 p.177] [11].

Form AA ties to the balance sheet. The 'Classified Summary of Assets' (Form AA) totals Tk 2,009.9m, against Tk 2,102.9m of total assets on the balance sheet [1 p.166] [1 p.155]. The Tk 93.0m difference equals the two balance-sheet lines Form AA does not list: the Tk 86.9m due from other insurers and the Tk 6.1m of right-of-use assets (our tie) [11]. Within Form AA, 'Cash on Fixed, STD and Current Deposit' of Tk 873.9m plus 'Cash in Hand and Stamps' of Tk 2.9m equal the balance sheet's Tk 876.9m of cash and bank balances, and shares (Tk 186.4m), unit funds (Tk 15.6m), the debenture (Tk 0.02m), pre-IPO shares (Tk 11.3m) and ACAML (Tk 14.4m) add to the Tk 227.7m investment line [1 p.166] [1 p.176] [1 p.172]. Form AA shows fixed assets 'At Cost' (Tk 248.2m), not at written-down value [1 p.166].

The SBC balance. Note 3 nets Tk 1,169.8m of amounts receivable from SBC and other insurers against Tk 1,082.9m due to SBC for reinsurance [1 p.174]. The receivable side includes Tk 922.7m of claims paid against reinsurance, which is Tk 1,023.4m less Tk 100.7m 'paid by S.B.C upto 2025' [1 p.174]. The gross recoverable equals 86.4% of equity at end-2025 (our arithmetic) [11]. The payable side is Tk 1,358.0m due less Tk 238.8m paid 'upto 2024' and Tk 36.3m during the year [1 p.177]. The notes give no ageing for either side.

Tax. Sundry debtors of Tk 501.3m are mostly advance income tax (Tk 480.0m), listed year by year from income year 2000 [1 p.175]. Against it, the provision for taxation is Tk 446.6m [1 p.154]. Note xiv prints: 'Assessment year 2002-2003, 2007-2008 to 2019-2020 & 2021-2022 .2022-2023 are appeal pending with High Court' [1 p.171]. Note 4.01(a) states that 'The shortfall of tax of relevant years will be met out of reserve for tax' [1 p.176]. Note 31 states that 'There exists no liability of contingent nature' [1 p.185].

Audit opinion. Ashraf Uddin & Co., Chartered Accountants (partner Mohammad Shibbir Hossain FCA) signed the report on April 23, 2026 [1 p.152]. The opinion reads, as printed: 'In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Company as at 31 December 2025, and of its financial performance and cash flows for the year then ended in accordance with International Financial Reporting Standards (IFRSs), the Insurance Act 2010 the Insurance Rules 1958, Bangladesh Securities & Exchange Rule 1987 and Other applicable laws and regulations.' [1 p.148]. The report contains no emphasis-of-matter or other-matter paragraph [1 p.148] [1 p.151].

Key audit matters. The first, headed '01. Premium Income Note: 24.00', reads: 'The gross premium amount of Tk. 717,995,952/- includes premiums received from public sector business for the full year, pertaining to contracts initiated during the reporting period. Given the material significance, interdependencies with other financial statement line items, and the inherent sensitivity of this figure, we have assessed this area as high-risk in terms of potential misstatement and financial reporting integrity.' [1 p.148]. The second, headed '02. Estimated liability in respect of outstanding claims whether due or intimated Note: 09.00', reads: 'The company has recognized an estimated liability of Tk. 116,456,403/- pertaining to outstanding claims from policyholders. This estimation involves significant management judgment, particularly in assessing claim reserves, and carries a heightened risk of understatement due to the inherent uncertainties in claims forecasting.' [1 p.149]. The note references as printed (24.00 and 09.00) differ from the notes that carry these figures in the accounts (premium in note 26; outstanding claims in note 10) [1 p.181] [1 p.177].

2026 so far: H1 profit after tax Tk 64.6m against Tk 49.7m; nine-month EPS Tk 2.20 against Tk 1.72

H1 2026. Net premium was flat at Tk 257.0m [3 p.2]. Gross premium for the half was Tk 379.1m (fire Tk 170.4m, marine Tk 155.7m, motor Tk 13.9m, miscellaneous Tk 39.0m) and Tk 122.0m was ceded, a retention of 67.8% (derived) [3 p.5] [11]; the half-year report does not print the H1 2025 class split. Net claims rose 33.2% to Tk 102.5m, 39.9% of net premium against 29.9% [3 p.2] [11]. The expense line fell 18.9% to Tk 134.8m [3 p.2] [11]. The expense note for 2026 lists management expenses (Tk 108.0m), management expenses charged to profit and loss (Tk 7.5m) and the unexpired-risk adjustment (Tk 19.3m), and no agency-commission line [3 p.5]. The Business Standard reported on 24-Dec-2025 that IDRA, by a circular issued on 23 December, scrapped commission payments in non-life insurance and suspended individual agent licences with effect from 1-Jan-2026 [8]. The interim report does not connect its expense figures to that circular.

Investment income and EPS. Income from investment and financial services rose 24.1% to Tk 39.1m: interest on FDR and STD accounts Tk 31.0m against Tk 23.7m, and on treasury bonds Tk 6.4m against Tk 5.8m [3 p.6] [11]. The company states that 'Earnings Per Share (EPS) increased due to increase of income from investment and financial services & decrease in expenses' [3 p.6]. H1 EPS was Tk 1.44 against Tk 1.11 and NAV per share Tk 25.97 at 30 June 2026 [3 p.2]. The only related-party item disclosed for the half is 'Group insurance premium for Tk. 496,850 paid to Meghna Life Insurance PLC' [3 p.7].

Q3 2026 (announced). After a board meeting on 29-Oct-2026, DSE posted on 1-Nov-2026: Q3 EPS Tk 0.76 against Tk 0.61; nine-month EPS Tk 2.20 against Tk 1.72; nine-month NOCFPS Tk 1.91 against Tk 0.89; and NAV per share Tk 25.22 at 30-Sep-2026 [7]. Nine-month EPS was 27.9% higher (our arithmetic) [11]. The Q3 2026 accounts were not in our filings corpus when this note was written, so no line-item detail is available for the quarter. Trailing EPS to September 2026 is Tk 2.61 (nine months 2026 plus 2025 less nine months 2025, our derivation) [11].

Balance sheet at June 2026. Cash and bank balances including FDRs were Tk 893.3m and short-term investments Tk 429.9m; outstanding claims were Tk 108.0m, premium deposits Tk 85.7m and shareholders' equity Tk 1,165.5m [3 p.2]. Fire outstanding claims were Tk 61.0m and marine Tk 34.0m at 30 June [3 p.5].

Governance: sponsors 32.74%, Meghna Life 9.48%, 10% cash dividend for each year 2022-2025

Ownership. At end-2025 sponsors held 14,692,681 shares (32.74%), financial institutions including ICB 2,079,653 (4.63%) and the general public 28,103,779 (62.63%), across 7,978 shareholders [1 p.177]. The pattern of shareholding lists 'Meghan Life Insurance PLC holds 42,53,056 shares' under parent, subsidiary, associated companies and other related parties [1 p.98]. Directors' holdings as printed: Mr. Nizam Uddin Ahmed (Representative of Nizam Hasina Foundation), Chairman, 31,09,463 (6.93%); Mr. Nasir Uddin Ahmed, Vice Chairman, 17,95,225 (4.00%); Mr. Md. Jaynal Abedin Bhuiyan (Representative of Meghna Life Insurance PLC), Director, 42,53,056 (9.48%); and Mr. Riaz Uddin Ahmed, Mrs. Raquiba Banu, Mrs. Sabita Ferdaushi, Mrs. Dilruba Sharmin and Mrs. Umme Khadiza Meghna, 2.00% each [1 p.98]. The independent directors, Mr. Md. Hafizullah and Mrs. Mahbuba Hossain, hold none [1 p.98]. No shareholder other than those listed holds 10% or more ('Nil') [1 p.98].

Board. The board page lists Nizam Uddin Ahmed (Representative of Nizam-Hasina Foundation) as Chairman, Nasir Uddin Ahmed as Vice-Chairman, six directors and two independent directors, with A.N.M. Fazlul Karim Munshi as Chief Executive Officer [1 p.49]. The board met six times in 2025 [1 p.95]. The attendance table also lists 'Mrs. Sharmin Nasir', Director, who attended four of the six meetings; she does not appear on the board page [1 p.95] [1 p.49]. DSE news records that Mrs. Sharmin Nasir, 'a Director of the company', transferred 897,604 shares to her spouse Mr. Nasir Uddin Ahmed by way of gift, confirmed on 25-Sep-2025 [7]. On 3-Nov-2024 DSE posted that the Chairman and Mrs. Hasina Nizam, a director, had completed transfers of 8,91,290 and 13,14,675 shares to Nizam-Hasina Foundation [7]. The independent directors were appointed for three years from 01/12/2024 and 17/12/2024 [1 p.98]. Directors receive Tk 8,000 per board or audit-committee meeting; Tk 616,000 in total in 2025 [1 p.185].

Related parties. Note 29 states that 'The Company maintains related party relationships exclusively with Meghna Life Insurance PLC and Meghna Life Securities and Investment Ltd.', and that each company has representation on the other's board [1 p.185]. The amounts as printed, each for Meghna Life Insurance PLC unless stated: group insurance premium paid Tk 424,396 (2024: Tk 413,440); dividend paid (gross) to Meghna Life Insurance PLC Tk 3,402,445 (2024: Tk 2,844,426); dividend received (gross) from Meghna Life Insurance PLC Tk 2,917,462 (2024: Tk 2,917,462); and, for Meghna Life Securities and Investment Ltd., commission paid against buy and sale of shares Tk 154,633 (2024: Tk 130,960) [1 p.185]. Sundry debtors also include Tk 210,836 from 'Meghna Life Securities Ltd.' and Tk 15,594,601 from 'Alliance Capital Asset Management Limited' [1 p.175].

Dividends. The company paid a cash dividend for every year from 2017 to 2025: 6% plus a 5% stock dividend for 2017 and 2018, 10% for 2019 and 2020, 12% for 2021 and 10% for each year from 2022 to 2025 [2 p.10] [1 p.26]. The 2025 report's highlights table prints 10% for 2021 against a dividend amount of Tk 53.85m, which is 12% of paid-up capital; the 2021 report prints 12% [1 p.26] [2 p.10]. For 2025 the board recommended 10% cash at its 244th meeting on April 23, 2026 [1 p.185]; the record date was 7-Jun-2026, the AGM was set for 9-Jul-2026 on a digital platform, and DSE posted the disbursement on 23-Jul-2026 [7]. The cash payout was 46.9% of 2025 EPS; across 2017-2025 it ranged from 39.7% (2017, on EPS as printed) to 90.9% (2019) [11].

24 months of DSE news. The DSE archive from 1-Nov-2024 to 1-Nov-2026 holds results, dividend, record-date, spot-market, board-meeting, credit-rating, share-transfer and name-change notices [7]. It contains no notice of a board approval for a capital project, expansion, rights issue or acquisition [7]. National Credit Ratings Limited assigned 'AAA' long-term and 'ST-1' short-term with a stable outlook on the 2024 accounts (posted 6-Aug-2025) and a surveillance rating of the same grades on the 2025 accounts (posted 4-Aug-2026) [7]. Fixed-asset purchases were Tk 10.4m in 2025 [1 p.165].

What's next: dated events after 31-Oct-2026 and the lines they relate to

These are dated events after 31-Oct-2026. We do not forecast numbers. Dates marked '(inferred)' come from precedent board-meeting and announcement dates; no date has been notified for them.

Commission line. The Business Standard reported that IDRA ended commission payments in non-life insurance with effect from 1-Jan-2026 [8]. Karnaphuli's 2025 revenue accounts carry Tk 99.4m of agency commission [1 p.181]. The H1 2026 expense note has no agency-commission line [3 p.5]. The FY2026 annual report (inferred late April 2027) is the first full-year report after 1-Jan-2026.

SBC and tax notes. Two balance-sheet items have no settlement date in the filings: the Tk 922.7m gross claim recoverable from SBC and the High Court tax appeals [1 p.174] [1 p.171]. Both are reported in notes 3, 4.01 and 15.01 of each annual report.

LDC graduation. The Daily Star and The Business Standard reported on 30-Oct-2026 that Bangladesh's graduation from least-developed-country status is now on 24-Nov-2029 [9] [10]. Karnaphuli's 2025 annual report does not quantify any effect on its lines.

Q3 2026 accounts. The Q3 2026 results were posted on 1-Nov-2026 and are covered in the recent-quarters section [7]; the full interim statements were not in our corpus at the time of writing.

Risks: each item and the line it relates to

Each row is a fact from the filings with the line it relates to; none is a forecast. Gross premium rose in each year from 2018 to 2025 [11], while net premium fell in 2025 with the higher cession [1 p.181]. Underwriting profit has been positive in every year of the series [2 p.10] [1 p.26]. The two balance-sheet items with no stated settlement timetable are the SBC claim recoverable and the tax appeals [1 p.174] [1 p.171]. The share portfolio is measured at fair value through other comprehensive income from 2025, so changes in the Meghna Life share price move the reserve for unrealised gain or loss rather than profit [1 p.172] [1 p.174].

• FY2026 annual report (board meeting inferred late April 2027): agency commission, retention, combined ratio, note 3 SBC balances, notes 4.01 and 15.01 on tax.
• Q3 2026 interim statements (results posted 1-Nov-2026): nine-month premium, claims and expenses.
• Any IDRA notification on management-expense limits, and any disclosure of Karnaphuli's position against them.
• NCR rating surveillance (inferred August 2027).

History 2017-2025 and market data

Figures for 2017-2020 come from the 2021 annual report's highlights page and for 2021-2025 from the 2025 annual report's 'Financial Information at a Glance' [2 p.10] [1 p.26]. The two agree for 2021. The 2025 table prints 2024 on the pre-restatement basis (profit after tax Tk 96.69m, NAV per share Tk 22.75, total assets Tk 1,956.03m), while the 2025 statements show restated 2024 figures of Tk 96.48m, Tk 23.12 and Tk 1,972.80m [1 p.26] [1 p.182] [1 p.183] [1 p.155]. EPS for 2017 and 2018 is as printed and not adjusted for the later bonus shares [2 p.10]. Profit after tax peaked at Tk 106.4m in 2021; the 2025 figure of Tk 95.8m was the third highest of the nine years [2 p.10] [1 p.26].

Market data (facts only). The shares closed at Tk 52.0 on 29-Oct-2026, 72.2% above the Tk 30.2 close a year earlier; in that year closes ranged from Tk 25.3 (13-Nov-2025) to Tk 59.5 (3-Sep-2026) [6] [11]. Market value at Tk 52.0 was Tk 2.33bn [11]. That is 24.4 times 2025 EPS, 19.9 times trailing EPS to September 2026 (derived), 2.06 times NAV per share at 30-Sep-2026, and a 1.9% yield on the 2025 dividend [11]. On the year-end prices printed in the annual reports, P/E ranged from 11.7x (2017) to 21.1x (2020) and P/B from 0.88x (2017) to 2.11x (2021) over 2017-2025 [2 p.10] [1 p.26] [11].

FAQ

How profitable was Karnaphuli Insurance in 2025?

Profit after tax was Tk 95.8m (EPS Tk 2.13) against a restated Tk 96.5m (EPS Tk 2.15) in 2024. Underwriting profit was Tk 70.2m and investment income Tk 77.1m. Return on average equity was 9.2% on our derived equity.

Why did Karnaphuli's net premium fall in 2025?

The filings show gross premium up from Tk 666.4m to Tk 718.0m and premium ceded to reinsurers up from Tk 202.5m to Tk 286.3m, so net premium fell from Tk 464.0m to Tk 431.7m. The report does not give a reason for the higher cession.

What is Karnaphuli Insurance's combined ratio?

82.2% in 2025 and 77.0% in 2024, measured as net claims plus management expenses plus agency commission less reinsurance commission (including profit commission), over net premium. On the same definition City Insurance was 75.5% and Asia Insurance 76.9% in 2025.

What did the auditor say about Karnaphuli's 2025 accounts?

Ashraf Uddin & Co. gave an unmodified opinion that the statements 'present fairly, in all material respects'. The key audit matters were premium income and the outstanding-claims estimate. There is no emphasis-of-matter paragraph.

What dividend did Karnaphuli pay for 2025?

10% cash, Tk 1.00 a share, 46.9% of EPS. It has paid a cash dividend for every year from 2017 to 2025, and 10% for each year from 2022 to 2025.

Who are Karnaphuli Insurance's related parties?

Note 29 names Meghna Life Insurance PLC and Meghna Life Securities and Investment Ltd. Meghna Life Insurance holds 9.48% of Karnaphuli and has a representative director; Karnaphuli holds 2,431,218 Meghna Life shares with a market value of Tk 120.8m at end-2025.

How much does Karnaphuli have in deposits and investments?

At end-2025: Tk 755.6m of fixed deposits with 40 banks and 7 NBFIs, Tk 118.4m in CD and STD accounts, Tk 154.0m of treasury bonds as the statutory deposit, and Tk 227.7m of shares, unit funds and other investments. It has no borrowings.

Sources

1. Karnaphuli Insurance PLC Annual Report 2025 (corpus KARNAPHULI_ANNUAL_2025; PDF page numbers, printed page = PDF page - 2) · link · accessed 2026-11-01
2. Karnaphuli Insurance Company Limited Annual Report 2021 (financial highlights 2017-2021, p.10) · link · accessed 2026-11-01
3. Karnaphuli Insurance PLC un-audited half-yearly report to 30-Jun-2026 · link · accessed 2026-11-01
4. City Insurance PLC Annual Report 2025 (peer; auditor's report p.386, consolidated revenue account p.394) · link · accessed 2026-11-01
5. Asia Insurance PLC Annual Report 2025 (peer; auditor's report p.167, consolidated revenue account p.178) · link · accessed 2026-11-01
6. AnalystBro market data: DSE daily bars for KARNAPHULI to 29-Oct-2026 · link · accessed 2026-11-01
7. DSE news archive for KARNAPHULI, 1-Nov-2024 to 1-Nov-2026 (old_news.php, criteria=3): results, dividends, record dates, board-meeting notices, NCR ratings, director share transfers, name change · link · accessed 2026-11-01
8. The Business Standard, 'IDRA scraps commission payments in non-life insurance sector', 24 Dec 2025 · link · accessed 2026-11-01
9. The Daily Star, 'Bangladesh gets 3 more years for LDC graduation', 30 Oct 2026 · link · accessed 2026-11-01
10. The Business Standard, 'Bangladesh gets 3 more years for LDC graduation', 30 Oct 2026 · link · accessed 2026-11-01
11. AnalystBro history and ratio model for KARNAPHULI (model.xlsx, the workbook below) · link · accessed 2026-11-01