Economy

GCR Affirms AIICO Insurance A(NG) Rating

Published

8 years ago

04/04/2018

By Dipo Olowookere

Global Credit Ratings has affirmed the national scale claims paying ability rating assigned to AIICO Insurance Plc of A(NG), with the outlook accorded as Negative.

GCR explained in a statement yesterday that the rating was affirmed because the insurer’s assets continue to be conservatively managed, with the bulk of investments in risk free Federal Government of Nigeria (FGN) bonds and treasury bills.

It noted that in this regard, cash and equivalent constituted about 83 percent of the investment portfolio at FY16, translating into a strong coverage of technical provisions (1.2x) and average monthly claims (48 months).

This is supported by sound asset liability matching for the long term business, as confirmed by the actuarial valuation report. Key liquidity measures are likely to register within a sound range over the rating horizon.

Capitalisation has moderated over the review period as sustained losses eroded the capital base. In this respect, consolidated capital declined to N7.6 billion at 3QFY17 from N7.9 billion at FY16 compared to N11.6 billion at FY12.

It said while the solvency levels in the short term business remain strong, the long term business evidences material capital shortfalls, especially considering the scale of the book.

However, comfort is derived from the sound asset liability matching, with bulk of the policyholders’ liabilities backed by risk free FGN bonds. Furthermore, statutory solvency on a consolidated basis reflects adequate coverage of assets over liabilities at FY16.

AIICO Insurance has evidenced notable earnings volatility throughout the review period, underpinned by a relatively elevated cost structure, coupled with the declining premium base and an increasing claims level.

Although FY16 reported a significant increase in operating profitability (underpinned by reserve releases due to the slow down on annuity uptake), this was eroded by the net losses on available for sale assets during the year. Going forward, the inherent variability in overall cost structure might continue to impact on the insurer’s earnings capacity, albeit, net profitability is expected to be supported by sound investment returns.

Notwithstanding the consistent decline in gross premiums for the short term business, AIICO’s competitive position remains moderate.

In this regard, consolidated premiums registered a compound annual growth rate of 6.3 percent for the five-year review period, albeit with a declining market share of 8.1 percent in FY16 (FY15: 11.3 percent).

GCR said going forward, continued focus on long term business, coupled with expanded retail exposure may gradually enhance the business profile.

AIICO’s reinsurance program consist counterparties with a sound aggregated credit profile. Note is taken of the elevated level (13 percent) of deductibles per risk and event relative to capital at FY16.

The rating agency said an upward movement of the rating or outlook may follow a sustainable strengthening of solvency metrics and business profile, coupled with the maintenance of liquidity metrics at strong levels.

Conversely, downward movement may result from a sustained weakening in capitalisation levels, and a significant loss of market share or sustained poor operating performance.

Economy

Tinubu Okays Extension of Ban on Raw Shea Nut Export by One Year

Published

4 hours ago

26/02/2026

Aduragbemi Omiyale

By Aduragbemi Omiyale

The ban on the export of raw shea nuts from Nigeria has been extended by one year by President Bola Tinubu.

A statement from the Special Adviser to the President on Information and Strategy, Mr Bayo Onanuga, on Wednesday disclosed that the ban is now till February 25, 2027.

It was emphasised that this decision underscores the administration’s commitment to advancing industrial development, strengthening domestic value addition, and supporting the objectives of the Renewed Hope Agenda.

The ban aims to deepen processing capacity within Nigeria, enhance livelihoods in shea-producing communities, and promote the growth of Nigerian exports anchored on value-added products, the statement noted.

To further these objectives, President Tinubu has authorised the two Ministers of the Federal Ministry of Industry, Trade and Investment, and the Presidential Food Security Coordination Unit (PFSCU), to coordinate the implementation of a unified, evidence-based national framework that aligns industrialisation, trade, and investment priorities across the shea nut value chain.

He also approved the adoption of an export framework established by the Nigerian Commodity Exchange (NCX) and the withdrawal of all waivers allowing the direct export of raw shea nuts.

The President directed that any excess supply of raw shea nuts should be exported exclusively through the NCX framework, in accordance with the approved guidelines.

Additionally, he directed the Federal Ministry of Finance to provide access to a dedicated NESS Support Window to enable the Federal Ministry of Industry, Trade and Investment to pilot a Livelihood Finance Mechanism to strengthen production and processing capacity.

Shea nuts, the oil-rich fruits from the shea tree common in the Savanna belt of Nigeria, are the raw material for shea butter, renowned for its moisturising, anti-inflammatory, and antioxidant properties. The extracted butter is a principal ingredient in cosmetics for skin and hair, as well as in edible cooking oil. The Federal Government encourages processing shea nuts into butter locally, as butter fetches between 10 and 20 times the price of the raw nuts.

The federal government said it remains committed to policies that promote inclusive growth, local manufacturing and position Nigeria as a competitive participant in global agricultural value chains.

Economy

NASD Bourse Rebounds as Unlisted Security Index Rises 1.27%

Published

4 hours ago

26/02/2026

Adedapo Adesanya

By Adedapo Adesanya

The NASD Over-the-Counter (OTC) Securities Exchange expanded for the first session this week by 1.27 per cent on Wednesday, February 25.

This lifted the NASD Unlisted Security Index (NSI) above 4,000 points, with a 50.45-point addition to close at 4,025.25 points compared with the previous day’s 3,974.80 points, as the market capitalisation added N30.19 billion to close at N2.408 trillion versus Tuesday’s N2.378 trillion.

At the trading session, FrieslandCampina Wamco Nigeria Plc grew by N5.00 to trade at N100.00 per share compared with the previous day’s N95.00 per share, Central Securities Clearing System (CSCS) Plc improved by N4.18 to sell at N70.00 per unit versus N65.82 per unit, and First Trust Mortgage Bank Plc increased by 14 Kobo to trade at N1.59 per share compared with the previous day’s N1.45 per share.

However, the share price of Geo-Fluids Plc depreciated by 27 Kobo at midweek to close at N3.27 per unit, in contrast to the N3.30 per unit it was transacted a day earlier.

At the midweek session, the volume of securities went down by 25.3 per cent to 8.7 million units from 11.6 million units, the value of securities decreased by 92.5 per cent to N80.7 million from N1.2 billion, and the number of deals slipped by 33.3 per cent to 32 deals from the preceding session’s 48 deals.

At the close of business, CSCS Plc remained the most traded stock by value on a year-to-date basis with 34.1 million units exchanged for N2.0 billion, trailed by Okitipupa Plc with 6.3 million units traded for N1.1 billion, and Geo-Fluids Plc with 122.0 million units valued at N478.0 million.

Resourcery Plc ended the trading session as the most traded stock by volume on a year-to-date basis with 1.05 billion units valued at N408.7 million, followed by Geo-Fluids Plc with 122.0 million units sold for N478.0 million, and CSCS Plc with 34.1 million units worth N2.0 billion.

Economy

Investors Lose N73bn as Bears Tighten Grip on Stock Exchange

Published

5 hours ago

26/02/2026

Dipo Olowookere

By Dipo Olowookere

The bears consolidated their dominance on the Nigerian Exchange (NGX) Limited on Wednesday, inflicting an additional 0.09 per cent cut on the market.

At midweek, the market capitalisation of the domestic stock exchange went down by N73 billion to N124.754 trillion from the preceding day’s N124.827 trillion, and the All-Share Index (ASI) slipped by 114.32 points to 194,370.20 points from 194,484.52 points.

A look at the sectoral performance showed that only the consumer goods index closed in green, gaining 1.19 per cent due to buying pressure.

However, sustained profit-taking weakened the insurance space by 3.79 per cent, the banking index slumped by 2.07 per cent, the energy counter went down by 0.24 per cent, and the industrial goods sector shrank by 0.22 per cent.

Business Post reports that 25 equities ended on the gainers’ chart, and 54 equities finished on the losers’ table, representing a negative market breadth index and weak investor sentiment.

RT Briscoe lost 10.00 per cent to sell for N10.35, ABC Transport crashed by 10.00 per cent to N6.75, SAHCO depreciated by 9.98 per cent to N139.35, Haldane McCall gave up 9.93 per cent to trade at N3.99, and Vitafoam Nigeria decreased by 9.93 per cent to N112.50.

Conversely, Jaiz Bank gained 9.95 per cent to settle at N14.03, Okomu Oil appreciated by 9.93 per cent to N1,765.00, Trans-nationwide Express chalked up 9.77 per cent to close at N2.36, Fortis Global Insurance moved up by 9.72 per cent to 79 Kobo, and Champion Breweries rose by 5.39 per cent to N17.60.

Yesterday, 1.4 billion shares worth N46.2 billion were transacted in 70,222 deals compared with the 1.1 billion shares valued at N53.4 billion traded in 72,218 deals a day earlier, implying a rise in the trading volume by 27.27 per cent, and a decline in the trading value and number of deals by 13.48 per cent and 2.76 per cent, respectively.

Fortis Global Insurance ended the session as the busiest stock after trading 193.7 million units for N152.7 million, Zenith Bank transacted 120.7 million units worth N11.1 billion, Japaul exchanged 114.8 million units valued at N407.0 million, Ellah Lakes sold 98.4 million units worth N999.2 million, and Access Holdings traded 63.1 million units valued at N1.7 billion.