Bahrain Kuwait Insurance Company (BKIC), the kingdom's largest insurer, has raised its stake in local peer Takaful International to 40.9 per cent, a move that could herald the start of wider consolidation in the sector.

Last week, BKIC had taken an initial 10.8 per cent stake in Takaful International, the largest Islamic insurance firm in a market that has 24 locally incorporated insurers including nine Islamic firms.

BKIC bought 18.8 million shares of Takaful International valued at 1.88 million dinars ($5 million) from three Bahraini and Kuwaiti institutions, according to a statement on the Bahrain bourse.

Takaful International ranks among the top five insurers in the country, but it swung to a loss of 1.7 million dinars in 2014 from a profit of 300,000 dinars a year earlier.

BKIC now becomes the largest shareholder in Takaful International, displacing Bahrain Islamic Bank which has a stake of 22.75 per cent. – Reuters