• Thursday, March 28, 2024
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Veritas Kapital to shore up capital base to N12bn

Veritas Kapital Assurance Plc

The management of Veritas Kapital Assurance Plc has announced it’s plan to shore up it’s capital base from N7 billion to N12 billion in accordance with the National Insurance Commission (NAICOM) minimum paid-up capital requirements for insurance companies.

Saratu Umar Garba, Secretary, Veritas Kapital, explained that the authorised share capital of the company will be increased from N7,000,000,000 (Seven Billion Naira) to N12 (Twelve billion Naira) through the creation of 10 billion units of preference shares of N0.50K each.

“In pursuant to the special resolutions (1-4) of the shareholders of veritas Kapital Assurance Plc authorising the board of directors to take all necessary steps including, initiating and negotiating mergers and/or acquisition or any other form of business combination or arrangement with any company/companies or institutions) whether foreign or local. for the purpose of shodng up the Company’s capital, the directors have been authorised to raise additional capital through an offer of up to, 10 billion irredeemable, 7 Years Convertible. Cumulative Prefereme Shares”.

The regulator for the Nigerian insurance sector, NAICOM had earlier announced the increase of the minimum paid-up capital of insurance companies by over 200 percent to take effect immediately for new applications while existing insurance and reinsurance companies shall be required to fully comply not later than June 30, 2020.

As contained in the new capital base guidelines of NAICOM, “Life insurance companies will now have a minimum paid-up capital of N8 billion from its previous minimum capital which was N2 billion, General Insurance companies will now have to recapitalize to N10 billion from the previous N3 billion, while Composite Insurance companies will now need N18 billion to underwrite businesses from the previous N5 billion minimum capital”.

“The new capital base requirement also affects reinsurance companies who will now have to raise their minimum paid-up capital from N10 billion to N20 billion if they must remain in business”.

“The Clause 6 of the Company’s Memorandum of association be amended as follows: The Authorised Share Capital of the company is N12 billion divided into 14 trillion units of Ordinary Shares at N0.50K each and 10 billion units of Preference Shares at N0.50K each”.

Kenneth Egbara, Managing Director, Veritas Kapital Assurance speaking at the general meeting in Abuja said that efforts are ongoing to ensure that the increased capital base increases within the required time. The instruments we are using is the convertible irredeemable preference shares which the shareholders are aware of and are happy about”.

“Raising fund in the capital market is a bit risky, and at this time where shareholders are not getting so much returns. We are almost certain that we can meet up”.

Egbara, speaking further said that Veritas is committed to securing the interest of the local shareholders before sourcing for foreign investor to further deepen access to capital.

 

Cynthia Egboboh, Abuja