Following the proposed changes by the National Insurance Commission (NAICOM) to the minimum regulatory requirement on paid-up capital for market expansion, some operators are concluding share capital increment exercise.
Speaking on this development, the Chief Executive Officer, AXA Mansard Insurance, Kunle Ahmed stated that paid-up capital is a form of corporate reorganisation, which would involve making substantial changes to a company's capital structure.
He said, "It is one of the strategies companies use to improve their financial stability. The post-recapitalisation insurance industry is expected to be robust and capable of underwriting big risks as well as contribute meaningfully to the nation’s gross domestic product (GDP)".
Ahmed went further by applauding the support of the shareholders as the company seeks to grow its capital and capacity to be more relevant to the economy.
Also, Capital Express Assurance Limited, with the use of the new regulation has increased its authorised share capital from N7.5 billion to N8 billion. This follows the new minimum capital requirement for life insurance companies set by the National Insurance Commission (NAICOM).
According to the Managing Director/Chief Executive Officer of Capital Express Assurance Limited, Mrs. Bola Odukale, the company is in talks with three companies for acquisition purposes to ensure a smooth recapitalisation.
Odukale added that the shareholders at their meeting approved rights issues and private placement as complementary efforts, which were part of the plans submitted to the board and NAICOM.