NSE Penalties: GNI, UNIVINSURE Join Other Insurance Firms with Biggest Fine

Proshare

Tuesday, November 13, 2018 / 11:45 AM / Proshare Research                                    

The continued failure of some insurance companies listed on the Nigerian Stock Exchange (NSE) to disclose their financial statements has compounded NSE sanctions on the affected firms.

Insurance companies account for thirty-one (31) out of eighty-seven (87) sanctions NSE imposed on listed firms for various financial delinquencies in its latest X-Compliance Report last updated on November 9, 2018. This implies that for every 10 firms NSE fines, about four (4) are listed in the insurance carriers, brokers and services (IBS) sub-sector of the financial services sector.

Great Nigeria Insurance Plc (GNI), which got the biggest share of the entire sanctions on insurance companies after Universal Insurance Plc (UNIVINSURE), was greatly hit as it failed to file its audited annual financial performance as and when due, making the firm to consider exit from the bourse.

For four consecutive quarters and still counting, Staco Insurance Plc (STACO) failed to disclose its financial statements. In fact, STACO’s audited 2016 and first quarter (Q1) 2017 financials that was filed was done after NSE regulatory due date.

As part of measures being carried out by NSE to maintain market integrity and protect investors, the regulator introduced the X-Compliance Report, a transparency initiative of the exchange that provides compliance related information on all listed companies.

A review of the report shows that there are ten categories of schedules for quoted firms on the exchange.

 SCHEDULE 1

EARLY FILERS OF QUARTERLY & AUDITED ACCOUNTS

SCHEDULE 2

DELINQUENT FILERS OF AUDITED ACCOUNTS

SCHEDULE 3

DELINQUENT FILERS OF QUARTERLY ACCOUNTS

SCHEDULE 4

DISCLOSURE VIOLATIONS

SCHEDULE 5

SANCTIONS FOR DEFAULT FILINGS OF FINANCIAL STATEMENTS

SCHEDULE 6

FREE FLOAT DEFICIENCIES

SCHEDULE 7

COMPANIES RESTRUCTURING AND/OR SLATED FOR DELISTING

SCHEDULE 8

REGULATORY SUSPENSIONS

SCHEDULE 9

LISTINGS REPORT (APPLICATIONS, LISTINGS AND DELISTING)

SCHEDULE 10

GENERAL MEETINGS OF LISTED COMPANIES

  Source: NSE

 

NSE listed STACO, African Alliance Insurance Plc (AFRINSURE), Goldlink Insurance Plc (GOLDINSURE) and Unic Diversified Holdings Plc (UNIC) in Schedule 2 for defaulting in their audited financial statements filing for the year ended December 2017.

Proshare Nigeria Pvt. Ltd.

  Source: NSE

While GOLDINSURE was the only insurance firm that failed to file its earnings results for the same period in 2016, it also joined others like AFRINSURE, STACO and UNIC to form a list of companies that defaulted in Schedule 3.

The listing followed failure of the insurance companies to file their first quarter 2018 financial results within thirty (30) days after the end of period as required by the law of the exchange.

Unmoved by the Missed Regulatory Filing (MRF) compliance status indicator code, STACO continued in the delinquent act for the third consecutive quarter and extended it to the fourth quarter without self-reproach.

STACO joined twenty-two (22) quoted firms including obstinate insurance firms like UNIC, AFRINSURE and GOLDINSURE that defaulted in their filings of interim financials for the period ended June 2018 and nineteen (19) listed firms that failed to file their third quarter financial statements for the period ended September 2018.

Proshare Nigeria Pvt. Ltd.

Source: NSE

Proshare Nigeria Pvt. Ltd.

Source: NSE

NSE Sanctions Insurance Firms

In line with its mandate to protect investors at the bourse, the Nigerian Stock Exchange imposed a total penalty of N272.9 billion on companies operating in the IBS sub-sector. The fine represents 32.26 percent of the total N845.9 billion imposed on quoted companies for violation of various regulations.

Great Nigeria Insurance Plc got a total of fine of N40.4 million for filing its audited and interim financial statements after the regulatory due date, prompting the issuer (GNI) to obtain an approval from its shareholders to delist the stock from NSE voluntarily.

DEFAULT FILINGS OF AUDITED/INTERIM ACCOUNTS

COMPANY

FINANCIAL

PERIOD ENDED

DATE FILED

PENALTY (N' 000)

GNI

Audited 2017

December

22-May-17

6,600

Q1 2018

December

6-Jun-18

3,700

Audited 2015

December

4-Apr-17

5,300

Audited 2016 and Q1 2017

December

31-Jul-17

24,800

Total

40,400

STACO

Audited 2016 and Q1 2017

December

6-Jun-18

7,500

EQUITYASUR

Audited 2017

December

27-Apr-18

2,400

LINKASSURE

Audited 2017

December

8-May-18

3,500

SOVRENINS

Audited 2016 and Q1 2017

December

5-Jul-18

10,200

MBENEFIT

Audited 2017

December

11-May-18

3,800

Q1 2018

December

16-May-18

1,600

Total

5,400

NIGERINS

Audited 2017

December

27-Jun-18

8,500

Q1 2018

December

27-Jun-18

5,800

Audited 2016 and Q1 2017

December

1-Jul-17

16,100

Total

30,400

UNIVINSURE

Audited 2017

December

18-Jul-18

10,600

Q1 2018

December

26-Jul-18

8,700

Half Year 2018

December

1-Aug-18

200

Audited 2016

December

28-Nov-17

51,400

Total

70,900

UNITYKAP

Audited 2017

December

6-Aug-18

16,100

Q1 2018

December

7-Aug-18

10,400

Half Year 2018

December

7-Aug-18

800

Total

27,300

CORNERST

Audited 2017

December

8-Aug-18

16,500

Q1 2018

December

8-Aug-18

10,800

Total

27,300

STDINSURE

Audited 2017

December

24-Aug-18

13,900

Q1 2018

December

27-Aug-18

14,800

Audited 2016 and Q1 2017

December

21-Jun-18

8,200

Total

36,900

GUINEAINS

Q1, Q2, and Q3 2016

December

18-Jul-17

6,900

Audited 2015

December

29-Dec-16

3,800

Total

10,700

Grand Total

 

272,900

Source: NSE, Proshare Research

In the same vein, STACO got a combined penalty of N7.5 million for filing its audited 2016 and first quarter 2017 financials after the regulatory due date.

Equity Assurance Plc (EQUITYASUR) and Linkage Assurance Plc (LINKASSURE) were sanctioned to the tune of N2.4 million and N3.5 million respectively for delaying their 2017 financial statements.

Sovereign Trust Insurance Plc (SOVRENINS) got N10.2 million; Mutual Benefit Assurance Plc (MBENEFIT), N5.4 million; Niger Insurance Plc (NIGERINS), N30.4 million; UNIVINSURE, N70.9 million; Veritas Kapital Assurance Plc (UNITYKAP), N27.3 million.

Cornerstone Insurance Plc (CORNERST) also received N27.3 million sanction for contravening the filing rule; Standard Alliance Insurance Plc (STDINSURE) was slammed N36.9 million, Guinea Insurance Plc (GUINEAINS) got N10.7 million.

GOLDINSURE obtained NSE’s approval for restructuring, while the Quotation Committee of the NSE (QCN) approved that International Energy Insurance Plc (INTENEGINS) be placed on restructuring subject to filing its quarterly compliance report.

 Insurance Firms on Suspension

Owing to repeated failures of some of these insurance companies to file relevant accounts by the expiration of the cure period, the NSE suspended two (2) insurance firms from the bourse in 2018, while trading in the shares of four others has so far been suspended in 2018.

Proshare Nigeria Pvt. Ltd.

Source: NSE

 

Proshare Nigeria Pvt. Ltd.

Source: NSE


 Proshare Nigeria Pvt. Ltd.


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