The Department of Petroleum Resources has revoked six oil block licences due to “legacy debts”, according to a public notice on Thursday. The move by the petroleum regulator was “in furtherance of a presidential directive.” The notice said oil mining lease (OML) 98 was revoked from Pan Ocean Oil, OML 120 and 121 from Allied Energy Resources, OML 108 from Express Petroleum & Gas, and OML 110 from Cavendish Petroleum. Oil prospecting licence (OPL) 206 was also revoked from Summit Oil. The licences withdrawal comes as the country takes a more aggressive approach to collect taxes and royalties it is owed. Oil industry sources said Nigeria has also been increasingly vocal about rescinding licences that are not being actively developed. However, details of the size or value of the blocks are not readily available.
Nine underwriting companies in Nigeria have paid a cumulative ₦76 billion in claims to policyholders who suffered insured risks in the 2018 financial year. The total claim was an increase from the figure recorded in the 2017 financial year as all the nine companies recorded an increase in claims paid in their latest financial year. The increase in claims volume is connected to the rise in replacement value of insured assets and partly, the increased awareness on the need for policyholders to make claims. Most of the nine insurers had to relinquish about 70 percent of their income to pay these claims, thereby, leaving them with just 30 percent profit. Market analysts expect the claims payment of the insurance industry to rise above ₦200 billion, by the time the claims figure of the remaining 48 insurance companies are made public. Leadway Assurance paid the highest claims of ₦33.8 billion, up from ₦27.4 billion in 2017. AIICO Insurance saw its gross claims increase by over 25 percent from ₦23.3 billion in 2017 to ₦29.1 billion in 2018. From this amount, about 76 percent was for benefits and claims payment in our Life business with the remaining 24 percent incurred in the Non-Life business. FBNInsurance paid ₦4.8 billion in claims to its policyholders who suffered insured risks in 2018 financial year, which is a 66 percent increase from the ₦2.9 billion paid in 2017. Consolidated Hallmark Insurance paid a gross amount of ₦4.7 billion in 2018 financial year as claims compared to the ₦3.3 billion paid in 2017. Sunu Assurance’s claims expenses rose to over ₦1 billion in its 2018 financial year. African Alliance Insurance paid a sum of ₦1.8 billion claims in Q1 2019. This shows ₦300 million growth from ₦1.5 billion claims paid in Q1 2018. The Nigerian Agricultural Insurance Corporation paid ₦464 million claims in Q1 2019 to its insured farmers across the country while Universal Insurance paid a sum of ₦194.9 million as claims in its 2017 financial year, while it equally paid ₦340.9 million in its 2018 financial year, recording about 80 percentage increase within the period under review. NSIA Insurance settled claims amounting to ₦673 million in its 2018 financial year.
Figures obtained from CBN show that the total assets and liabilities of commercial banks at the end of February 2019 stood at ₦38.40 trillion, representing 3.2 percent increase above the level recorded in December 2018. The report said that the funds were sourced, largely, from foreign liabilities; draw down on reserves and acquisition of credit from the CBN as they were used, mainly, for payment of demand deposits, and settlement of claims on the CBN and the Federal Government. The break down of the figures shows that at ₦20.93 trillion, banks’ credit to the domestic economy, at end-February 2019 showed an increase of 1.3 percent, compared with the level at end-December 2018. The development reflected the 1.8 percent rise in claims on the private sector in the review period. Total specified liquid assets of the banks was ₦13.266 trillion at end-March 2019, representing 59.5 percent of the total current liabilities. The liquidity ratio at that level was 2.2 percentage points below the level at end-December 2018, but 29.50 percentage points above the stipulated minimum ratio of 30.0 percent. The further breakdown shows that the loans-to-deposit ratio was at 60.04 percent, 0.13 percentage point and 19.96 percentage points lower than the level at end-December 2018 and the prescribed maximum of 80.0 percent, respectively. The regulator, on its monetary and credit developments report, said it loosened its monetary policy stance in Q1 2019, as the Monetary Policy Rate was adjusted downward by 50 basis points to 13.50 percent from 14.00 per cent.
The chairman, Senate Committee on Appropriations, Danjuma Goje, has endorsed Ahmed Lawan to emerge as the next Senate President. The endorsement, which took place on Thursday, followed a meeting with President Muhammadu Buhari in his office at the Presidential Villa, Abuja. After the meeting, Goje said he decided to endorse Lawan despite the widespread calls for him to run for the office of Senate President because he had been asked to do so by President Buhari. He said it is also to respect the wish of his party and to enhance unity in the party.