Economy
Sovereign Trust Insurance Raises Share Capital to Meet Tier-1 Requirements
By Dipo Olowookere
Few months ago, the National Insurance Commission (NAICOM) introduced a tier-based recapitalisation for insurance companies in Nigeria in three different categories depending on their capital base.
Under the new system, Tier 1 insurance companies are required to have minimum capital base of N9 billion for general insurance and N6 billion for life insurance, implying a composite capital base of N15 billion.
Tier 2 companies are divided into two categories, with N4.5 billion minimum capital base for general insurance and N3 billion for life assurance, meaning a composite insurance-general and life insurance will be required to have minimum capital base of N7.5 billion.
Tier 3 companies will continue to operate on the existing minimum capital base of N3 billion for general insurance and N2 billion for life insurance, implying a composite capital base of N5 billion for a composite tier 3 insurance company.
Sovereign Trust Insurance Plc, one of the 27 insurers on the Nigerian Stock Exchange (NSE), in order not to be caught napping, took a decision to raise its capital base by increasing its share capital.
The board of the firm had proposed to create an addition 5 billion ordinary shares of 50 kobo each to increase its authorised share capital to N10 billion from N7.5 billion, indicating an additional N2.5 billion share capital.
During the company’s Annual General Meeting (AGM) held on Thursday, September 27, 2018 in Lagos, shareholders of Sovereign Trust Insurance gave the board the approval to make this happen.
According to Chairman of the insurance firm, Mr Oluseun Ajayi, this would make the company operate in the Tier-1 category.
“It is important to state our company’s resolve to adequately operate in the Tier- 1 category with the plan of increasing our capital base both organically and inorganically before the commencement of the Tier Based Minimum Solvency capital regime,” Mr Ajayi told shareholders at the meeting.
He expressed confidence that with the new share capital, Sovereign Trust Insurance would be able to compete favourably at the market with others.
According to the Chairman, the insurance sector, like every other sector of the economy in the last financial year, struggled to overcome the challenges posed by the lingering effects of the economic recession experienced in the previous year.
He said this left businesses in a stagnated position and eroded the purchasing power of the populace thereby slowing down their urge for insurance.
Giving an insight into the company’s performance in the 2017 financial year, Mr Ajayi said Sovereign Trust Insurance’s Gross Written Premium (GPW) hit N8.5 billion, representing a 33 percent rise over the N6.3 billion recorded in 2016.
According to him, the Net Claim Expenses (NCE) paid in the year under review was N1.3 billion, representing a 9.5 percent improvement over N1.44 billion paid in 2016, noting that the drop was as a result of efficient claims paid in 2016.
He said the company recorded a N202 million Profit before Tax in 2017 against N44 million recorded in 2016, representing over 351 percent increase, while the Profit after Tax stood at N157 million, a 569 percent increase when compared with the N23 million recorded in 2016.
By Aduragbemi Omiyale
One of the paint makers in Nigeria, Premier Paints Plc, is currently in talks with a new investor, Xenergi Limited, for the purchase of 51 per cent stake in the company.
Xenergi Limited intends to acquire shares of Clover Global Resources Limited and TGHL Capital Limited in the organisation.
Business Post gathered that the new investor will buy 39.02 per cent from Clover Global Resources Limited and 15.20 per cent from TGHL Capital Limited.
The deal, according to a regulatory notice issued on Tuesday on the Nigerian Exchange (NGX) Limited, will involve about 63 million shares of Premier Paints.
At the current share price of the paint producer, this should be about N630 million as it closed at N10.00 per unit on NGX on December 16, 2025.
“Subject to obtaining required regulatory approvals, the transaction is expected to close before January 31, 2026.
“The company will continue to inform the public of the progress of the transaction,” the disclosure signed by the company secretary, Alozie Nwokoro, said.
By Adedapo Adesanya
The Naira was flat against the US Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Tuesday, December 16, retaining the previous closing value of N1,451.82/$1.
In the same vein, the local currency saw no movement against the Pound Sterling and the Euro in the spot market during the session at N1,943.98/£1 and N1,705.74/€1, respectively.
Also, the Nigerian Naira remained unchanged in the black market yesterday at N1,475/$1 and was N1,460/$1 at the GTBank forex counter.
The Central Bank of Nigeria (CBN) has strengthened US Dollar supply with $250 million to authorised dealer banks at the official window cumulatively as foreign portfolio investors, exporters and non-bank corporate supply dripped.
The spread between official and other non-regulated markets decreased to N30.59$/1 from N44.57/$1, from the previous week, research subsidiary of Coronation Merchant Bank Limited said in a report.
FX analysts said foreign exchange inflows through the Nigerian Foreign Exchange Market decreased to $716.3 million from $844.70 million in the previous week , a 15 per cent drop in a week.
Foreign portfolio investors accounted for the highest share of inflows at 32.98 per cent, followed by exporters at 30.84 per cent, the CBN (17.36 per cent), Non-bank Corporates (16.94 per cent), others (0.72 per cent) and Individuals (0.63 per cent).
On Monday, Nigeria’s headline inflation rate eased to 14.45 per cent in November 2025, down from 16.05 per cent recorded in October, according to the latest Consumer Price Index (CPI) report released by the National Bureau of Statistics (NBS), representing a decrease of 1.6 percentage points month-on-month and marks a significant moderation compared to the same period last year.
As for the cryptocurrency market, there was some recoveries after overall capitalization falling below $3 trillion for the third time in a month. Large-cap assets, particularly those with Exchange Traded Fund (ETF) exposure, are experiencing selling pressure as institutional investors reassess risk.
Ripple (XRP) appreciated by 1.5 per cent to $1.92, Litecoin (LTC) expanded by 1.5 per cent to $78.91, Dogecoin (DOGE) rose by 0.8 per cent to $0.1308, Solana (SOL) went up by 0.4 per cent to $127.60, Binance Coin (BNB) grew by 0.3 per cent to $865.40, and Bitcoin (BTC) gained 0.2 per cent to sell at $86,735.17.
On the flip side, Cardano (ADA) depreciated by 1.0 per cent to $0.3802 and Ethereum (ETH) slumped by 0.4 per cent to $2,935.85, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) were flat at $1.00 each.
By Dipo Olowookere
A marginal 0.01 per cent rise was recorded by the Nigerian Exchange (NGX) Limited on Tuesday. This was different from the flattish mode of the market the previous day.
Investor sentiment remained bullish as Customs Street finished with 31 price gainers and 26 price losers, implying a positive market breadth index.
Aluminium Extrusion topped the gainers’ log after it improved its price by 10.00 per cent to N9.35, Guinness Nigeria appreciated by 9.98 per cent to N263.40, Multiverse expanded by 9.95 per cent to N12.15, MeCure Industries also soared by 9.95 per cent to N45.85, and Sovereign Trust Insurance advanced by 9.89 per cent to N4.11.
Conversely, Haldane McCall led the losers’ chart after it shed 9.93 per cent to settle at N3.72, Veritas Kapital lost 9.09 per cent to close at N1.60, LivingTrust Mortgage Bank also declined by 9.09 per cent to N3.50, and Linkage Assurance depreciated by 5.71 per cent to N1.65.
During the trading day, the All-Share Index (ASI) went up by 21.23 points to 149,459.11 points from the previous day’s 149,437.88 points and the market capitalisation increased by N14 billion to N95.281 trillion from N95.267 trillion.
Yesterday, traders transacted 1.0 billion equities for N21.8 billion in 23,701 deals compared with the 553.1 million equities valued at N13.3 billion traded in 28,907 deals on Monday, representing a decline in the number of deals by 18.01 per cent, and a surge in the trading volume and value by 80.80 per cent and 63.91 per cent apiece.
Access Holdings traded 385.8 million stocks worth N7.7 billion, Champion Breweries transacted 111.8 million shares valued at N817.8 million, Sterling Holdings exchanged 85.5 million equities for N589.9 million, FCMB sold 74.7 million shares valued at N791.5 million, and First Holdco transacted 51.9 million equities worth N1.8 billion.
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