The Nigerian Stock Exchange (NSE) has fined 20 Insurance Companies and 1 Re-insurance Company for their failure to submit their Financial Statements within the stipulated timelines. The Exchange has therefore applied sanctions in accordance with the provisions of Section 14 of Appendix 111 of the Listing Rules.
According to the latest X-Compliance report which is a transparency initiative of The Exchange designed to maintain market integrity and protect the investors by providing compliance related information on all listed companies, Companies that are listed on The Exchange are required to adhere to high disclosure standards which are prescribed in Appendix 111 of the Listing Rules. Financial information which is periodic disclosure and on-going material events disclosure should be released to The Exchange in a timely manner to enable it efficiently perform its function of maintaining an orderly market.
In the report, Niger Insurance Plc, Universal Insurance Plc, STACO, Regency Alliance, African Alliance and International Energy Insurance Plc (IEI) topped the list of defaulters.
Details of the Fines are as follows:
SANCTIONS FOR DEFAULT FILINGS OF FINANCIAL STATEMENTS
2015 Default Filing:
|1||Mutual Benefit Assurance Plc||December 2013||2,700,000.00|
|2||African Alliance Insurance Plc||December 2013||4,200,000.00|
|3||Universal Insurance Plc||December 2013||5,300,000.00|
|4||NEM Insurance Plc||December 2014||4 300,000.00|
|5||LASACO Assurance Plc||December 2014||4 400,000.00|
|6||Equity Assurance Plc||December 2014||4,500,000.00|
|7||Regency Assurance Plc||December 2014||4 700,000.00|
|8||Staco Insurance Plc||December 2014||4 700,000.00|
|9||Niger Insurance Plc||December 2014||4 700,000.00|
2014 Default Filling
|1||International Energy Insurance Plc||December 2012||5,400, 000.00|
|2||Regency Alliance Insurance Plc||December 2013||600,000.00|
|3||WAPIC Insurance Plc||December 2013||700,000.00|
|4||Oasis Insurance||December 2013||700,000.00|
|5||AIICO Insurance Plc||December 2013||800,000.00|
|6||Niger Insurance Plc||December 2013||1,000,000.00|
|7||Continental Reinsurance Plc||December 2013||900,000.00|
|8||Law Union & Rock Insurance Plc||December 2013||600,000.00|
|9||Sovereign Trust Insurance Plc||December 2013||1,100,000.00|
|10||Linkage Assurance Plc||December 2013||1,200,000.00|
|11||Royal Exchange Plc||December 2013||1,400,000.00|
|12||Guinea Insurance Plc||December 2013||1,500,000.00|
|13||Prestige Assurance Plc||December 2013||1,600,000.00|
|14||Unity Kapital Assurance Plc||December 2013||3,000,000.00|
Analysts are of the view that penalties as these not only erode the brand equity of the companies concerned but reduce profitability as well
They posit that insurance companies should do everything possible to avoid paying fines given the fact that investors are generally unhappy with Nigerian insurance stocks most of which trade on the floor of the Stock Exchange for around 50k per unit of share and give depressing dividend returns.