Board of Directors of Niger Insurance Plc has secured the nod of its shareholders to continue with her recapitalization plans already approved by the National Insurance Commission (NAICOM) to enable it comply with the new minimum capital requirement set for insurance and reinsurance companies in the country.
The approval secured during the Company’s 49th Annual General Meeting held in Lagos empowered the directors to take all steps necessary to effect agreed resolutions to recapitalize the company and make it competitive in the nation’s insurance industry.
“That, subject to obtaining the of relevant regulatory authorities, the directors be and are hereby authorised to take all necessary steps to raise additional capital of up to N15 billion only, whether by way of rights issue, private placement; or to negotiate a merger and/ or acquisition or any other form of business combination or other arrangement or a combination of methods with an insurance company; and that the right issue be executed at such price, time and on such other terms and conditions as the directors may deem fit”.
Another major resolution at the meeting was share capital reconstruction, which according to chairman of the company; Stephen Dike will create the headroom for the recapitalisation.
He said: “The essence of the share capital reconstruction is to enable the company pursue its recapitalisation objective and comply with the new minimum regulatory requirement at a fractional cost, thereby optimizing use of the Company’s limited financial resources.”
Dike said Niger Insurance has engaged Chapel Hill Denham and Mainstream Bank Capital Limited as financial advisers, to assist in developing a viable strategic blue print for the successful recapitalisation of the company.
He said that Nigeria was exploring an optimal mix of funding options including rights, private placement, merger and /or acquisition, stating that it was already discussing with potential investors who will not only being in capital but also technical expertise.
Dike also noted that the ongoing transformation drive and activities will put the company back on the track of sustainable growth and profitability.
Edwin Igbiti, managing director/CEO of the Company said the first order of business on resumption at the company was for the executive management to develop a winning strategy that will deliver the company’s top goals and priorities.
Igbiti said that management has designed a five-year strategy (2020-2024) transformation plan with three main priorities which includes strengthen its balance sheet, straighten its people and strengthen its business model.
He stated that the company was restructuring its balance sheet by converting some of the fixed assets positions to liquid assets in fixed income securities in favour of safe and guaranteed returns.
Igbiti assured its customers that all their claims would be met, while all matured investment will be paid as customer’s remains biggest priority of Niger Insurance.
Boniface Okezie, national coordinator, Progressive Shareholders Association of Nigeria, Bisi Bakare, president Noble shareholders Association of Nigeria among others applaud the ongoing transformation in Niger Insurance, while giving their support to board and movement to bring them company back to its position as leader in the market.
The Nigerian insurance regulator, NAICOM had in a circular issued on Monday May 20, 2019 announced increase in the paid-up share capital of life companies from N2 billion to N8 billion; General Business from N3 billion to N10 billion; Composite Business from N5 billion to N18 billion; and Reinsurance companies from N10 billion, to N20 billion.
According to the Commission, the minimum paid-up share capital requirement shall take effect from the commencement date of this circular (May 20, 2019) for new applications, while existing insurance and reinsurance companies shall be required to fully comply not later than 30th June 2020.
