Sovereign Trust increases insurance sector to 21.
December 22nd, 2006 Ugonna Maduagufor || ugonna@stockmarketnigeria.com
(by Ugonna maduagufor)
Sovereign Trust Insurance Plc was within the month listed in the Nigerian Stock Exchange, thereby increasing the number of quoted insurance companies in the insurance sector to twenty one (21). According to the managing director, Mr. Olusegun Ajayi the listing plan was initiated in April 2004, when the company was converted into a ‘public liability company’ even before the federal governments directives on recapitalization of insurance companies. However, he also said that the company has successfully reached a merger agreement with Confidence Insurance Plc, Coral International Insurance Company limited. He also stated that the companies recently concluded private placement of N1 billion ordinary shares of 50 kobo each, sold at 80 kobo per share was over subscribed. The share holders’ fund of the merged company will now exceeds the N3 billion capital base requirement for non-life insurance business. The recapitalization scheme requires a minimum asset base increase (comparing current to post policy implementation) as follow: from prevailing N150 million to N2 billion for life insurers; N200 million to N3 billion for general (non-life) insurance; and the reinsurance minimum capital also increased from N350 million to N10 billion.
The company’s return on investment is ranked among the top five in the insurance industry. From their financial records, the company over the last 10 years has consistently issued bonus shares and paid dividend to its shareholders at an average yearly increase of about 43.37%.
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