Breaking News

NAICOM should span 3-tier recapitalization policy into ten years – stakeholders

Managing Director of Lancelot Ventures Limited, Mr. Adebayo Adeleke, has appealed to the National Insurance Commission, NAICOM, to span the 3-tier recapitalization policy into a 10 year period.

Speaking to Vanguard, Adeleke who is a shareholder in many companies quoted on the Nigerian Stock Exchange, NSE, said that the 10 year period would give companies adequate time to beef up their capital.

Adeleke said, “NAICOM should consider a 10-year recapitalization roadmap that would enable life insurance companies raise their capital to N20 billion; general operators, N30 billion and composite firms, N50 billion.”

According to him, the first phase of recapitalisation should be within a period of 18 months and life underwriters should raise their capital from N2 billion to N4 billion, general business operators should move theirs from N3 billion to N5 billion, while composite companies should move theirs from N5 billion to N9 billion.

For the second phase, Adeleke said that the recapitalization should be within three years after the first exercise, and life operators should move their capital to N8billion, non-life, N10 billion and composite, N18 billion.

For the third phase, which should be five years after the second recapitalization exercise, life underwriters should beef-up their capital to N20 billion, general business underwriters, N30 billion and composite firms, N50 billion.

Adeleke called on NAICOM to evolve templates and incentives for mergers and acquisitions to enable strong firms absorb weak ones, as against waiting for firms to be bankrupt, and then take over the management.

Similarly, past President of the Chartered Insurance Institute of Nigeria (CIIN), Bala Zakariya’u, charged regulators in the financial services industry to create the enabling environment for mega companies to be established through mergers and acquisitions, adding “Such mega financial institutions are to be tasked with higher capital and solvency, sophisticated information technology infrastructure, best in class human resources and strong brand presence.”

All rights reserved. This material and any other digital content on this platform may not be reproduced, published, broadcast, written or distributed in full or in part, without written permission from VANGUARD NEWS.


Comments expressed here do not reflect the opinions of vanguard newspapers or any employee thereof.
Do NOT follow this link or you will be banned from the site!