SUNU Assurances Nigeria Plc has assured that it would achieve the minimum capital base of N10 billion in due course.
At the annual general meeting on Thursday in Lagos, directors of the insurance company reassured shareholders that the company is on course to achieving the N10 billion minimum capital base.
Chairman, SUNU Assurances Plc, Mallam Kyari Bukar said the company would achieve the minimum capital base of N10 billion as stipulated by the National Insurance Commission (NAICOM).
The meeting was conducted at the company’s headquarters in Victoria Island, Lagos State, with attendance strictly by proxy, in line with government’s directive on physical distancing and the restriction on the maximum number of people allowed in every gathering due to the COVID-19 pandemic.
Members entitled to attend and vote at the meeting appointed either Bukar, Managing Director of Sunu Assurances, Mr. Samuel Ogbodu; President of the Nigerian Solidarity Shareholders Association, Chief Matthew Akinlade or representatives from the Lagos Zone Shareholders Association to do so on their behalf.
In addition to electing members of the company’s audit committee, shareholders ratified the appointment of Mr. Karim-Franck Dione as non-executive director as well as re-elected non-executive directors, Mr. Kyari Bukar as Chairman, Ms. TaizirAjala as Vice Chairman and Mr. Ibikunle Balogun, amongst other approved resolutions.
Sunu Assurances Nigeria plans to cancel 11.2 billion ordinary shares of 50 kobo each out of its existing issued 14 billion ordinary shares of 50 kobo each as part of a recapitalisation plan aimed at increasing the capital base of the insurance company to the new minimum capital base.
At an extraordinary general meeting in April 2020, shareholders of the company had approved a proposal by the board of the company to cancel four ordinary shares out of every five ordinary shares held by shareholders.
The company stated that the purpose of the share capital reduction was “to allow for the issuance of new ordinary shares by way of a rights issue and private placement, in order for the company to comply with the recently revised share capital requirement by the National Insurance Commission (NAICOM) for insurance companies”.
The company explained that the share capital reconstruction was adopted as the more efficient approach to creating room for new equity capital issuances.
“The share capital reconstruction will lead to the cancellation of 11.2 billion ordinary shares and result in an increase in the share price to N1. This will enable the rights issue, private placement and any subsequent equity capital raising to be priced above the nominal value of 50 kobo,” the company stated.
NAICOM had in May 2019 released new capital requirements for insurance businesses. The minimum paid-up share capital of a life insurance company was increased from N2 billion to N8 billion, non-life insurance from N3 billion to N10 billion, composite insurance from N5 billion to N18 billion while re-insurance companies were directed to raise their capital base from N10 billion to N20 billion.