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Business News

NAICOM keen on recapitalization

Acting Insurance Commissioner, Mr Sunday Thomas has promised to pursue the process of strengthening the Insurance sector capability in the process of retaining businesses in the country.

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Sunday Thomas, Naicom

The Acting Insurance Commissioner, Mr Sunday Thomas has promised to pursue the process of strengthening the Insurance sector capability in order to help in retaining businesses in the country.

He revealed this at a meeting with reporters in attendance, restating his desire to carry out this assignment with due diligence. He also asked for cooperation across board in order to make a meaningful contribution to society.

Insurance in Nigeria, FBN Holdings Annual general Meeting, FBN General Insurance Limited CEO Bode Opadokun, FBN General Insurance Limited 2018 financial result

Insurance in Nigeria

[READ MORE: ANED explains why the recapitalisation of Discos may not work]

The NAICOM boss also hinted that the issue of recapitalization is very vital if the sector must grow.

We believe that at the end of the exercise, we would have turned around the image of the market. As an agency of the Federal Government, more than ever before, NAICOM wants to be visible, while also doing everything within its terms of reference as an institution to improve on its contributions to the economy. We have the mandate to ensure that the exercise throws up very solid companies.

The insurance sector wants to be part of the big game players and the driver of that initiative has to be the regulator. The issue of recapitalization is more critical than ever before. Of course, there are shades of opinion about its adequacy, it’s timing.  But for me here, it is just to tell you that the work ahead is a whole lot more than you can ever imagine.

More clearly put: Recapitalization for the NAICOM is a process that showcases a long-standing industry, willing to carry out all its obligations to the letter. Sunday said even though the process would be duly followed, they were willing to welcome new investors if need be to strengthen the sector. He noted that perfection and a viable insurance sector was the end-game.

Sigma Pensions

[READ MORE: Why Lagos State Government might not encourage ride-hailing startups – Joe Igbokwe]

The back story: A Nairametrics report portends a possible increase in the capital base of insurance firms to about N15 billion. According to industry sources, NAICOM mandated insurance firms to recapitalize or merge in order to meet the new capital requirement.

The move is expected to curtail the risk insurers take with their little capital, coupled with the twin risks arising from the impairment of certain assets and inappropriate pricing of insured risks. The essence of this increase is to promote soundness and profitability of insurers, support the stability of the financial system and increase insurance contribution to the nation’ GDP.

Reincarnated as a lover of stocks, Angel investors, seed funds, and anything aligned to tech or startups raising money, Joseph's work at Nairametrics involves following the money to wherever it leads. Before joining Nairametrics, he won an investigative journalism fellowship with ICIR, appeared in several national dallies, with hard-hitting opinions, features and investigative pieces. He has also engaged in content marketing and copywriting for a top e-commerce firm in Nigeria.

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Business

FG explains why Lagos-Ibadan rail line was not linked to the sea

The government in its explanation said that the delay was due to disruption by trucks going in and out of the port complex.

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FG needs $656 million to complete Lagos-Ibadan railway project – Amaechi, Nigeria loses N150 billion annually to shipping tariffs, Ibadan to Kano rail construction

The Federal Government has stated why the China Civil Engineering Construction Company (CCECC) Nigeria Limited could not link the final part of the Lagos-Ibadan rail line to the sea.

The government in its explanation said that it was due to disruption by trucks going in and out of the port complex.

According to a press statement signed by the Director, Press and Public Relations of the Federal Ministry of Transportation, Eric Ojiekwe, this disclosure was made by the Minister of Transportation, Rotimi Amaechi, while on a routine tour of the Lagos-Ibadan rail line project on Saturday, April 10, 2021.

The Minister pointed out that the original blueprint for the Lagos-Ibadan rail line project was not adhered to by CCECC Nigeria Limited and TEAM consortium and therefore warned that the master plan of the soon to commence Ibadan-Kano rail line project should not be changed.

The statement from the ministry partly reads, “The Nigerian Government has restated its commitment to connect the whole country by rail with the soon to commence Ibadan-Kano Standard Gauge Rail project.”

Amaechi forewarned that the master plan of the soon to commence project should not be changed as the original blueprint for the Lagos-Ibadan wasn’t adhered to by Messrs CCECC Nigeria and TEAM consortium. The Minister who rode the train from Ebute-Meta to the 8.72 km Apapa Port Spur line, informed the media that the inability of Messrs CCECC Nigeria to link the final part of the rail line down to the sea is rather due to disruption by trucks going in and out of the port complex.’’

The Minister had noted that the Federal Government has paid its share of the counterpart funding of the Ibadan-Kano rail line project and is waiting for China-Exim bank to ratify its side of the agreement for the project to commence.

He also advised the Nigerian Railway Corporation (NRC) to acquire more land around the train stations and the rail tracks for future development adding that this will be near impossible to do in the future as whatever space available now would have been taken over by businesses attracted to the rail line.

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In case you missed it

It can be recalled that full commercial train services commenced on the Lagos-Ibadan rail line after train operations commenced on December 7, 2020, with only Lagos, Ibadan and Abeokuta residents enjoying the train services.

This is because other minor and major stations along that route were yet to be completed.

 

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Manufacturing

Industrial Index loses -12.39 points, as BUA and Lafarge Cement shares top losers list

The NSE Industrials index lost 12.39 index points in the first trading week in the month of April.

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Manufacturing: Activity levels pick up albeit readings still below water

The Nigerian Stock Exchange Industrial Index at the close of trading activities for the first week in the month of April closed on a bearish note, following a 0.66% decrease in the shares of BUA CEMENT and Lafarge.

At the close of trading activities on the Nigerian Stock Exchange on the 9th of April 2021, the industrial index depreciated by 55.01 index points, to close lower at 1,928.18 index points for the week.

When compared to the overall performance of the market, the NSE Industrial index underperformed, noting that the NSE All-Share Index and Market Capitalization depreciated by 0.66% to close the week at 38,866.39 and N20.3350 trillion respectively.

READ: COVID-19, VAT, FX scarcity adversely impacted our operations in 2020 – Nigerian Breweries boss says

What you should know

The NSE Industrial Index was designed to provide an investable benchmark to capture the performance of the Industrial Sector. It comprises the most capitalized and liquid companies in the industrial sector and is based on the market capitalization methodology.

The index tracks the performance of ten industrial companies on the Nigerian Stock Exchange which includes Dangote, BUA, and Lafarge Cement.

The overall performance of the companies for the week was bearish, as the index closed on a negative note driven by the decrease in the share price of BUA Cement and Lafarge.

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MEYER (19.51) was the only gainer for the week, while BUACEMENT (-1.09%) and LAFARGE WAPCO (-3.00%) were the only losers for the week.

GAINER

  • MEYER up by19.51% to close at N0.49.

LOSER

  • WAPCO down by -3.00% to close at N21.00.
  • BUACEMENT down by -1.09% to close at N72.70.

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