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Royal Exchange Assurance splits business portfolio
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A major underwriting firm, Royal Exchange Assurance plc has secured the approval of its shareholders to split its business portfolio into life and non-life insurance firms that will operate as independent entities.
The company which now operates as a group of businesses, will have as its insurance subsidiaries, Royal Prudential Life Assurance Company plc and Royal Exchange General Insurance Company Limited, while Royal Exchange Assurance plc ceases to be an insurance company.
The internal arrangement, according to the company, had followed the initial directive during the insurance industry reform exercise urging companies to separate their life and non-life businesses into different companies. This was before the review committee appointed by the Ministry of Finance upturned the directive, making it optional.
Royal Exchange noted however, that the separation of the license was significant to the actualisation of its strategic objective to be a one- stop financial institution and strengthen its leadership position in the industry.
Speaking at its Court Ordered Meeting in Lagos, Kenneth Odogwu, chairman of the company, said “Upon the scheme coming into effect, the life insurance business of Royal Exchange will be undertaken by Royal Prudential while the non-life insurance business will be undertaken by Royal General.
“On the benefits of the scheme, there will be immense growth opportunities for Royal Exchange as a holding company having other subsidiaries in the financial services sector such as pension and mortgage.”
This strategy, he assured, would create superior deal, providing opportunities, productivity gains and enhanced net earnings that would result in additional value to shareholders.
According to him, this would bring greater transparency and corporate governance in the operations of the life and non-life insurance business of the group and in the long run, help in balancing the interests of its shareholders with other shareholders in the subsidiaries.
Other benefits included further deepening of Royal Exchange product offerings, thus increasing sales, gross revenue and diversifying income streams; continuing to compete adequately with other strong financial service organisations, thus providing the platform to grow its market share within the African continent.
Under the scheme, 1,999,999,999 ordinary shares of N1 each in Royal General already issued and allotted to Royal Exchange will be credited as fully paid upon effecting the transfer of the entire life portfolio and underlying assets together with the assigned assets and liabilities of a net asset value of N2,44I,639,000 to Royal Prudential.
That 2,999,999,999 ordinary shares of N1 each in Royal General already issued to Royal Exchange will be credited as fully paid upon effecting the transfer of the entire non life portfolio and the underlying assets together with the assigned and liabilities of a net asset value of N3,492,136,000 to Royal General.
The company which now operates as a group of businesses, will have as its insurance subsidiaries, Royal Prudential Life Assurance Company plc and Royal Exchange General Insurance Company Limited, while Royal Exchange Assurance plc ceases to be an insurance company.
The internal arrangement, according to the company, had followed the initial directive during the insurance industry reform exercise urging companies to separate their life and non-life businesses into different companies. This was before the review committee appointed by the Ministry of Finance upturned the directive, making it optional.
Royal Exchange noted however, that the separation of the license was significant to the actualisation of its strategic objective to be a one- stop financial institution and strengthen its leadership position in the industry.
Speaking at its Court Ordered Meeting in Lagos, Kenneth Odogwu, chairman of the company, said “Upon the scheme coming into effect, the life insurance business of Royal Exchange will be undertaken by Royal Prudential while the non-life insurance business will be undertaken by Royal General.
“On the benefits of the scheme, there will be immense growth opportunities for Royal Exchange as a holding company having other subsidiaries in the financial services sector such as pension and mortgage.”
This strategy, he assured, would create superior deal, providing opportunities, productivity gains and enhanced net earnings that would result in additional value to shareholders.
According to him, this would bring greater transparency and corporate governance in the operations of the life and non-life insurance business of the group and in the long run, help in balancing the interests of its shareholders with other shareholders in the subsidiaries.
Other benefits included further deepening of Royal Exchange product offerings, thus increasing sales, gross revenue and diversifying income streams; continuing to compete adequately with other strong financial service organisations, thus providing the platform to grow its market share within the African continent.
Under the scheme, 1,999,999,999 ordinary shares of N1 each in Royal General already issued and allotted to Royal Exchange will be credited as fully paid upon effecting the transfer of the entire life portfolio and underlying assets together with the assigned assets and liabilities of a net asset value of N2,44I,639,000 to Royal Prudential.
That 2,999,999,999 ordinary shares of N1 each in Royal General already issued to Royal Exchange will be credited as fully paid upon effecting the transfer of the entire non life portfolio and the underlying assets together with the assigned and liabilities of a net asset value of N3,492,136,000 to Royal General.
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