‘Why Nigerian companies are investing in Ghana’

The President of Chartered Insurance Institute of Nigeria (CIIN) and the Managing Director, Continental Reinsurance Plc, Mr. Adeyemo Adejumo, spoke on why Ghana is fast becoming investors hub in Africa, among other industry issues.Excerpts:

Sir, in view of your company’s result in the year ended 2006, investors are of the opinion that you should declare dividend?
It was not our intention not to give dividend this year, if you look at the number of our shareholders now, our shareholders move from about 1.5 billion to 10.3 billion shareholders, the shareholders base has got so big for the net income which we made in 2006. That made it difficult for us to share any thing this year, otherwise, we planned to share almost the same thing as we did last year. We ought to have made everybody quite happy. However, if you look at the result as at half year, as it has been published, even with the escrow account being delayed with little or no interest, being paid on it, our shareholders will be able to smile in 2007 account. We will definitely give dividend to shareholders next year.

In view of government decision on escrow account, don’t you think that government can still listen and release the rest of interest accrued to that money because of its negative impact on businesses?
It will definitely impact negatively on many companies result, but some of us have been prudent, we have not really taken much of the escrow account into our result. Some accrued for the interest on escrow account we did not, so if you have accrued of it up till September at a particular percentage, and you are getting far lower than that, you may have serious problem, for those that are prudent and are saying when we see the figure we know what it is they may not have that kind of problem.

Is the Continental Reinsurance in the position to provide all the business that the entire market need?
We are up to the task, our capital base has gone up substantially, we have more than N11 billion in terms of net asset base, that has given us huge capacity, I want you to realise that we are not the only one in the market, African Re is still there, between us and African Re, we should be able to corporate and give the necessary reinsurance backing to all the companies in the market without any problem at all.

Almost all Nigerian companies are heading for Ghana, what is in Ghana that made it special to operators?
Ghana is an emerging market. Lot of things are happening in Ghana, and a lot of foreign direct investment that should have been coming to Nigeria. Most foreign investors find comfort in Ghana for so many reasons, and this is why we Nigerians, who have the population, who have the economy, human resources should really brace up, money doesn’t go where there is no security, foreign investors will not come if we cannot guarantee the security of life and properties, if we cannot guarantee constant supply of electricity, money will not come here. If the government can pay attention to those two things, more money will come here than it goes to any other place. For now, Ghana is enjoying such of facilities, and that is why a lot of things are happening there. And any upward looking company will want to see what is happening in Ghana to be able to take advantage of what is going on there.

As the president of CIIN, has the industry been able to take a look at the proposed budget for 2008, is there any thing there that will assure the industry that 2008 financial year will be better than last year?
Personally, I have not really had the time to go through it but, we have a committee in CIIN that is going through it, and they make a report available, and I will also personally take a look at it and compare it with what happened in the past and make appropriate comment on the budget. Hoewver, if the government is asking us to increase our capacity, they have a lot of things lined up for the industry. One of them is the local content issue, not only in NNPC but in marine and aviation, which is going to have a serious impact on the insurance industry. The second matter is already making impact.

Federal government is getting ready to pay premium and once federal government pay the premium of group life of the federal civil servant, all the parastatals under them, the state government and others will follow, which means a big boom for us in the life business. Come 2008, we are going to get more support from the federal government.

We must brace up to penetrate the market rather than depending on government income alone.

Are you aware that there is no provision made for the payment of premium on the group life policy by the Federal Government?
No, some of my colleagues are in Abuja right now, looking at the position od things. They gave me assurance, this week, that the money had been approved and it will be released any time from now.That is for 2007 and if they are paying in 2007, why will they not pay in 2008? Although, as I told you, I have not gone through the budget, I have not noticed if it is not there, even if it is not there, it can still be corrected, if anything happens, that means the Federal Government is not living up to her words.

CIIN set to reposition insurance industry

Ayeleso Oladele, Lagos

The management of the Chartered Insurance Institute of Nigeria (CIIN), has disclosed that the quest of growing the post-consolidation insurance sector in the desired direction and for the Chief executive officers of the industry to have enough reasons to redefine their strategies was the rationale behind the international seminar to be organised by the institute.

The institute, as part of its corporate responsibilities, has made all arrangements for an international seminar slated for February 2008, targeted at the men and women in the driver’s seat in today’s Nigerian Insurance industry. Such people include Chief Executive Officers, Managing Directors, and General Managers of Insurance and Reinsurance companies.

Others, according to a statement by the institute, made available to newsmen in Lagos, recently, include broking and loss adjuster firms, regulatory authorities and trade group within the Nigerian insurance industry.

Joseph Obah, an assistance director and Head, Corporate Affairs of the institute, in the statement disclosed that, CIIN, in consideration of the immeasurable benefits for human capital development, has designed an international seminar aimed at periscoping effective risk profiling in the context of corporate governance.

The seminar, according to him, which combines effective syndicate sessions with context based studies of business models, parades speakers from United Kingdom and Nigeria.

Mr. Fola Daniel, Commissioner for Insurance and Chief Lugard Aimiuwu, Nigeria’s corporate governance guru are leading the Nigerian team to the venue of the seminar while Dr. Sandy Scott, Director General of Chartered Insurance Institute (UK) will lead a group of UK-based speakers to the seminar as well.

Mr. Adegboyega Adepegba, while speaking on the epoch making seminar, said that the level of the the institute’s preparedness for the seminar is highly encouraging, adding that there are hopes that the strident efforts will be justified by the participation of chieftains and captains of the industry, who, ostensibly, hold the reins of insurance and related businesses in Nigeria.

In view of the nation’s economic reform, which according to him, have changed the face and complexion of the financial services industry, notably banking and insurance sectors and with business entities transforming into mega players, he said that the competencies of executive managers will continue to be in focus.

He, however, added that the institute, while ensuring that those with right acumen are entrusted with the management and control of huge investment engendered by the recapitalisation and consolidation exercise, said training and retraining is of no little importance to today’s business environment.

Addressing insurance practitioners in Kano, recently, the president of CIIN, Mr. Adeyemo Adejumo, stressed the imperatives for continuous professional development, saying that the institute was on the verge of adopting a ratings approach aimed at providing a score card that could monitor the commitment of insurance employers in matters affecting concern for the professional life of their staff through constant training.

The president, however, had tasked employers in the industry to integrate training benefits as part of their employment package.

Meanwhile, the institute has accordingly, reviewed the syllabuses of its professional examinations and engendered a new structure and content.