Foreign Acquisition Of Insurance Firms Very Pathatic —- ISAN

By Ngozi Onyeakusi—The National Coordinator, Independent Shareholders Association (ISAN) of Nigeria, Mr Igbrude Moses has described as being pathetic the foreign acquisition of insurance companies.
Moses, who express worry over the development said the foreigners only take advantage of the nation’s bad economy, undervalued stocks and the poor exchange rate.
Speaking during a courtesy visit of the members of the Insurance and Pension Editors of Nigeria (IPEN) to ISAN Secretariat today
in Oregun Lagos, he stated, “Our economy is so bad that most of our stocks are undervalued, our exchange rate is so poor, only a million dollar will translate to N700m, then if you have N700m, in this industry, you can buy and have a stake in insurance companies”, he lamented.
He stated that not all Direct Foreign Investment (DFI) was good for the Nigerian economy, even as he noted that some of the portfolio investors come to take advantage of the weak laws and economy. ” What they do is buy into firms and delist them from Nigeria Exchange and they become private business and then hid them from the eyes of the government and the next thing, you wouldn’t hear about the companies again”, he said.
Acknowledging the fact that there were still good investors, he appealed to the insurance industry regulatory body, the National Insurance Commission (NAICOM) to allow only genuine investors into the industry, even as he urged the commission to put in place process to check activities of the fake ones.

On recapitalisation, Moses noted that what was good for insurance industry is performance driven recapitalisation. “When firms do well, they will make money themselves”, he assured.
He stated that there was need for NAICOM to found out how firms utilise funds already at their disposal before thinking of further injection.
He stated that there was no need of pumping excess money into companies. According to him, when firms are not doing well, the regulator should give them time and monitor them.
Insisting that recent recapitalisation in the banking industry led to market crash, Moses strongly opposed recapitalisation in insurance industry adding that recapitalisation done in the past failed to yield any meaningful returns to shareholders. Operators took the opportunity of enriching themselves, he said.

Also speaking at the event, the National Secretary of ISAN, Mr Chibuzor Eke called on NAICOM to provide enabling environment for insurance business to thrive.
He equally challenged insurance firms to wake up and focuse on their core business in order to attract investment . He noted that insurance business was quite challenging given the fact that operators were bent on playing with funds instead of focusing on their core business.
He regretted that in other jurisdictions insurance firms own banks but in Nigeria he said reverse was the case.
Speaking further Eze, who opined that shareholders were not gaining anything from speculative investment, noted that they knew firms that were doing well and those that were not.
Operators, he said should stop enriching themselves instead consider the interest of shareholders who made investment to their firms.

Earlier in his presentation, the President of IPEN, Mr Chuks Udo Okonta said the purpose of IPEN visit to ISAN was to seek a cordial media relationship with the association as well as allowed the shareholders to assess their investment in insurance industry.

He promised that IPEN, as a body of insurance and pension editors ready to reshape the two sectors through developmental journalism.