Economy

AIICO Boosts GWP by 12.2% as Profit Dips 17.6% in Q1’21

Published

5 years ago

04/05/2021

By Adedapo Adesanya

Leading insurance company, AIICO Insurance Plc, recorded a 12.2 per cent growth in its Gross Written Premium (GWP) to N19.7 billion in the first quarter of 2021 from N17.6 billion recorded in the corresponding quarter of 2020.

According to the company, the increase was due to a year-on-year rise of 34.0 per cent in the general insurance business (35.7 per cent of gross written premiums) to N7.0 billion as against N4.6 billion recorded in Q1 2020.

However, the profit after tax declined by 17.6 per cent year-on-year to N1.5 billion in the first quarter of 2021 from N1.9 billion in the first three months of last year.

It was observed that the profit before tax increased by 11.3 per cent year-on-year to N1.6 billion in Q1 2021 from N1.4 billion in Q1 2020 on the back of improved overall profitability in the insurance businesses (Life, General and HMO).

AIICO revealed that it recorded an underwriting profit of N27.7 billion in Q1 2021 compared to the N131.0 million loss posted in Q1, noting that it was attached to changes in sovereign bond yields, which impacted the value of the company’s liabilities and assets.

In the life business, the firm explained that it was typically concerned about whether there is a surplus or deficit of assets over liabilities because of these movements. However, because of limitations in financial reporting, changes in liabilities affect underwriting profits while changes in assets are reported below underwriting profits.

“The effect is the significant variation in underwriting profits especially in volatile investment yield environments, such as we have in Nigeria. During Q1 2021, annualized yields rose by 430 basis points to 11.7 per cent at the long end of the yield curve, leading to a reduction in the fair values of assets and liabilities; the reduction in liabilities led to positive underwriting profit while the reduction in assets is reflected in the fair value losses for the period,” it said.

According to the firm, the total investment income declined to a loss of N24.1 billion in Q1 2021 compared to N4.7 billion in the same period of last year. This came as the federal government’s bond yields rose, affecting the fair value of the company’s financial assets. FGN bonds make up most of AIICO’s investment portfolio.

It was revealed that profits in its wealth management business declined in Q1 2021 as capital markets turned bearish during the quarter.

Total assets declined by 11.1 per cent to N216.2 billion in Q1 2021 as against N243.1 billion in the preceding year driven by a reduction in financial assets (-9.3 per cent; 79.0 per cent of total assets) and cash and cash equivalents (-38.2 per cent; 9.1 per cent of total assets).

Total liabilities declined by 13.4 per cent to N180.6 billion in the review period as against N208.4 billion recorded in the full year 2020. This was driven mainly by a decline in insurance contract liabilities (-15.9 per cent) from the rise in yields and reserving for new business and fixed income liabilities (-9.5 per cent) in its asset management business.

Total equity increased by 2.8 per cent to N35.6 billion in Q1 2021 from N34.7 billion recorded in the whole of 2020.

Commenting on the results, the Managing Director and Chief Executive Officer (CEO), Mr Babatunde Fajemirokun, said, “The world is in a difficult moment and Nigeria has not been spared.

“Even as the world starts to move on from the pandemic, the economic after-effects will reverberate for a while yet. However, there is some reason for optimism – economic activities have improved, and the country will likely exit the recession. Oil prices remain elevated, and the pandemic-induced lockdowns are easing all over the world.

“We made significant strides in 2020: implementing our business continuity plan and leveraging technology to improve processes and get closer to our customers. Building on this, we recorded premium growth of 12.2 per cent year-on-year to N19.7 billion in Q1 2021. Our financial position remains resilient as well – shareholders’ funds increased 3.3 per cent year-to-date to N34.8 billion.

“Nonetheless, we remain optimistic that economic activities will continue to rebound in coming periods, the IMF has revised its economic growth forecasts for Nigeria upward to 2.5 per cent from 1.5 per cent.

“Insurance, like every other sector, will have its role to play in the economic recovery as enablers of economic growth by assuming risks that encourage long-term direct investment which enhances production and job creation. Our robust financial position ensures that we can meet our obligations when they arise.”

AIICO Insurance is a leading composite insurer in Nigeria with a record of serving our customers that dates back over 50 years. Founded in 1963, AIICO provides life and health insurance, general insurance and investment management services to create and protect wealth for individuals, families and corporate customers.

Economy

Food Concepts Return NASD OTC Exchange to Danger Zone

Published

8 hours ago

05/12/2025

Adedapo Adesanya

By Adedapo Adesanya

Food Concepts Plc neutralized the gains recorded by three securities, returning the NASD Over-the-Counter (OTC) Securities Exchange into the negative territory with a 0.27 per cent loss on Thursday, December 4.

Yesterday, the share price of the parent company of Chicken Republic and PieXpress declined by 34 Kobo to sell at N3.15 per unit compared with the previous day’s N3.49 per unit.

This shrank the market capitalisation of the OTC bourse by N5.72 billion to N2.136 billion from N2.142 trillion and weakened the NASD Unlisted Security Index (NSI) by 9.57 points to 3,571.53 points from 3,581.10 points.

Business Post reports that Central Securities Clearing System (CSCS) Plc went down by 50 Kobo to N38.50 per share from N38.00 per share, FrieslandCampina Wamco Nigeria Plc gained 29 Kobo to sell at N55.79 per unit versus N55.50 per unit, and Geo-Fluids Plc added 5 Kobo to close at N4.60 per share compared with Wednesday’s closing price of N4.55 per share.

Trading data indicated that the volume of securities recorded at the session surged by 6,885.3 per cent to 4.3 million units from the 61,570 units posted a day earlier, the value of securities increased by 10,301.7 per cent to N947.2 million from N3.3 million, and the number of deals went up by 146.7 per cent to 37 deals from the 15 deals achieved in the previous trading session.

At the close of business, Infrastructure Credit Guarantee Company (InfraCredit) Plc was the most traded stock by value on a year-to-date basis with the sale of 5.8 billion units for N16.4 billion, trailed by Okitipupa Plc with 170.4 million units worth N8.0 billion, and Air Liquide Plc with 507.5 million units valued at N4.2 billion.

InfraCredit Plc also finished the session as the most traded stock by volume on a year-to-date basis with 5.8 billion units transacted for N16.4 billion, followed by Industrial and General Insurance (IGI) Plc with 1.2 billion units sold for N420.2 million, and Impresit Bakolori Plc with 536.9 million units traded for N524.9 million.

Economy

Investors Gain N97bn from Local Equity Market

Published

8 hours ago

05/12/2025

Dipo Olowookere

By Dipo Olowookere

The upward trend witnessed at the Nigerian Exchange (NGX) Limited in recent sessions continued on Thursday as it further improved by 0.10 per cent.

This was despite investor sentiment turning bearish after the local equity market ended with 23 price gainers and 28 price gainers, indicating a negative market breadth index.

UAC Nigeria gained 10.00 per cent to finish at N88.00, Morison Industries appreciated by 9.94 per cent to N3.54, Ecobank rose by 8.53 per cent to N36.90, and Coronation Insurance grew by 8.47 per cent to N2.56.

On the flip side, Ellah Lakes depreciated by 10.00 per cent to N13.14, Eunisell Nigeria also shed 10.00 per cent to finish at N72.90, Transcorp Hotels slipped by 9.95 per cent to N157.50, Omatek shrank by 9.23 per cent to N1.18, and Guinea Insurance dipped by 8.46 per cent to N1.19.

Yesterday, the All-Share Index (ASI) went up by 152.28 points to 145,476.15 points from 145,323.87 points and the market capitalisation chalked up N97 billion to finish at N92.726 trillion compared with the previous day’s N92.629 trillion.

Customs Street was bubbling with activities on Thursday, though the trading volume and value slightly went down, according to data.

A total of 1.9 billion stocks worth N19.2 billion exchanged hands in 23,369 deals during the session versus the N2.3 billion valued at N21.0 billion traded in 21,513 deals a day earlier.

This showed that the number of deals increased by 8.63 per cent, the volume of transactions depleted by 17.39 per cent, and the value of trades decreased by 8.57 per cent.

For another trading day, eTranzact led the activity chart with 1.6 billion units sold for N6.4 billion, Fidelity Bank traded 31.0 million units worth N589.3 million, GTCO exchanged 28.3 million units valued at N2.5 billion, Zenith Bank transacted 27.1 million units for N1.6 billion, and Ecobank traded 21.9 million units worth N744.3 million.

Economy

Naira Loses 18 Kobo Against Dollar at Official Market, N5 at Black Market

Published

8 hours ago

05/12/2025

Adedapo Adesanya

By Adedapo Adesanya

The Naira marginally depreciated against the United States Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Thursday, December 4 amid renewed forex pressure associated with December.

At the official market yesterday, the Nigerian currency lost 0.01 per cent or 18 Kobo against the Dollar to close at N1,447.83/$1 compared with the previous day’s N1,447.65/$1.

It was not a different scenario with the local currency in the same market segment against the Pound Sterling as it further shed N15.43 to sell for N1,930.97/£1 versus Wednesday’s closing price of N1,925.08/£1 and declined against the Euro by 20 Kobo to finish at N1,688.74/€1 compared with the preceding session’s N1,688.54/€1.

Similarly, the Nigerian Naira lost N5 against the greenback in the black market to quote at N1,465/$1 compared with the previous day’s value of N1,460/$1 but closed flat against the Dollar at the GTBank FX counter at N1,453/$1.

Fluctuations in trading range is expected to continue during the festive season as traders expect the Nigerian currency to be stable, supported by intervention s by to the Central Bank of Nigeria (CBN)in the face of steady dollar demand.

Support is also expected in coming weeks as seasonal activities, particularly the stylised “Detty December” festivities, will see inflows that will give the Naira a boost after it depreciated mildly last month, according to a new report.

“As the festive Detty December season intensifies, inbound travel, tourism spending, and diaspora inflows are expected to provide moderate support for FX liquidity,” analysts at the research unit of FMDA said in its latest monthly report for November.

Traders cited by Reuters expect that the Naira will trade within a band of N1,443-N1,450 next week, buoyed by improved FX interventions by the apex bank.

Meanwhile, the crypto market was down as the US Federal Reserve’s preferred inflation gauge, core PCE, likely rose in September—moving in the wrong direction. However, volatility indices show no signs of major turbulence.

If the actual figure matches estimates, it would mark 55 straight months of inflation above the US central bank’s 2 per cent target. The sticky inflation would strengthen the hawkish policymakers, who are in favour of slower rate cuts.

Ripple (XRP) depreciated by 4.5 per cent to $2.08, Solana (SOL) went down by 3.8 per cent to $138.11, Litecoin (LTC) shrank by 3.1 per cent to $83.23, Dogecoin (DOGE) slid by 2.5 per cent to $0.1463, Cardano (ADA) declined by 2.1 per cent to $0.4368, Bitcoin (BTC) fell by 0.9 per cent to $91,975.45, Binance Coin (BNB) crumbled by 0.9 per cent to $899.41, and Ethereum (ETH) dropped by 0.7 per cent to $3,156.44, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) closed flat at $1.00 apiece.