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UMORU ABDULKADIR
Consolidated Hallmark Insurance Plc will offer Right Issue to its shareholders to improve their shareholding as the company seeks about N4 billion to meet up with the new capitalisation directive for the classes of business it operates.
The National Insurance Commission (NAICOM) had in May directed insurance underwriters in the country to increase their capital base, setting June 30, 2020 deadline.
This directive requires that Consolidated Hallmark increase its capitalisation from N3 billion being a general business provider to N10 billion as required by the insurance regulator.
The latest audited financial report as at December 31, 2018 showed a capital approximately N6.1 billion which require it provide additional N3.9bn to meet the new threshold of N10bn.
Managing Director, Mr. Eddie Efekoha told newsmen, “the minimum capital for Insurance Company businesses in the country with effective date of June 30, 2020 has been increased from the erstwhile N3bn to N10bn, adding that .
The statement said, “it is therefore imperative that we share with you our plans to attain this new capital threshold within the shortest possible time, and to enlist your support, our esteemed shareholders, to realise this new target. Our first line of action is to issue additional shares by way of rights issue. This will give to you, as an existing shareholder the opportunity to increase your stake in the company and take benefit of a lower offer price than that of a public offer.”
It further noted that “the company in the recent past made a number of positive strides, some of which are worth mentioning here. The company recorded 19 per cent growth in its gross premium income in 2018. It achieved a 330 growth in its income line from retail segment of its portfolio, a result of the implementation of its retail expansion strategy. On the governance side, Consolidated Hallmark Insurance (CHI) achieved 87 and 84 per cent full compliance with corporate governance principles of NAICOM and the Securities and Exchange Commission (,SEC) respectively. The company in addition, improved on its latest credit rating by Agusto & co.from a Bbb – to a Bbb. This reflects a stable outlook and potential for growth.”
“The additional capital will not only enable the company to meet the regulatory requirement, but it will also be deployed to specific initiatives that will help CHI accelerates its growth and consolidate its leadership position in the insurance industry while delivering exceptional returns to the shareholders”.
BADEJO ADEMUYIWA has 23 years experience as a Finance Writer, specialising in Insurance and Investigative Reporting.
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