The Oasis Reporters
January 30, 2024
Insurance Firms that used to be standalone funds in pension matters have seen them in romance with banks as an integral part of the frontline financial economy of business.
First, Access Holdings (which trades as Access Corporation) had initially completed the acquisition of indirect equity stake In Sigma pensions after merging FGPL with Sigma in December 2022.
It has now moved and acquired ARM Pensions that is a major player in the pension industry, so that the new entity would be well-positioned to stimulate economic activities and contribute to the overall standing of the corporate body.
With this move, the future outlook of pensions in Nigeria is going to look more robust.
The birth of Access ARM Pensions signals a commitment to excellence and client satisfaction.
Zenith Bank had previously moved to bring onboard, Prudential Insurance and the merger & acquisition name became Zenith Prudential Insurance.
By December 2021 when Prudential Zenith Life Insurance Limited (“PZL”) announced its audited financial results for the year, it recorded a 75% growth in profit after tax (PAT) of ₦1.13b compared to the ₦646m recorded in the corresponding period in 2020.
FCMB Group Plc too, announced that it had purchased a 60 per cent stake in AIICO Pension Managers Limited.
Stanbic IBTC, Nigeria’s largest pension fund, posted a pre-tax profit of N34.2 billion in 2022, representing a 5% increase from the same period in 2021.
These examples illuminate one thing:
Banks, Insurance Firms Mergers are banking on increased low cost funds as a win-win situation for both the insurance industry and the banking sector if they work in synergy.
Hitherto before the huge interest banks are currently having in insurance firms, they were laid back in their business outlays making insurance sales slow, boring and uninteresting.
Having understudied the potentials in insurance, banks moved in to jazz it all up, make the marketing upbeat and put them as an integral part of financial institutions.
The governance structure has now changed with early and prompt claims, as banks inject their upbeat marketing to bear on insurance.
Zenith Bank’s merger with Prudential Insurance for instance, led them to grabbing the highest number of million dollar round table qualifiers when Prudential Africa announced that 222 of its sales representatives across seven of its markets in Africa qualified for the Million Dollar Round Table (MDRT) in the first half of 2022.
That’s the strategy. The mergers and acquisitions show farsightedness.