Treasury earns Sh252m payout from Kenya Re

Corporate News

Kenya Reinsurance managing director Jadiah Mwarania during an investor briefing in August 2013. Photo/SALATON NJAU    Nation Media Group

By DAVID HERBLING

In Summary

• Re-insurer raised its dividend payout by 50pc to Sh420 million.
• The government holds a 60 per cent stake in the NSE-listed re-insurer whose dividend payment will total Sh420 million.
• Kenya Re’s net profit of Sh3 billion, compared to Sh2.8 billion in 2012, came on the back of strong growth in underwritten premiums.

The Treasury is set to earn Sh252 million dividend from re-insurance group Kenya Re, which has raised its dividend payout by 50 per cent after recording 7.1 per cent growth in full-year profit for 2013.

The government holds a 60 per cent stake in the NSE-listed re-insurer whose dividend payment will total Sh420 million.

Lagos-based Continental Reinsurance plc, where Britam plans to acquire a minority stake, will earn Sh1.9 million from its 0.46 per cent shareholding.

Other top owners who will bank fat dividend cheques include John Kibunga Kimani, a retired civil servant, who will earn Sh709,540 from his 1.2 million shares; millionaire investor Paul Wanderi Ndung’u (Sh612,010); and Peter Kingori Mwangi who will take home Sh385,630.

Kenya Re’s net profit of Sh3 billion, compared to Sh2.8 billion in 2012, came on the back of strong growth in underwritten premiums.

The underwriter attributed the performance to winning new businesses in African markets, which saw total gross premium grow by a fifth to Sh9.6 billion.

Managing director Jadiah Mwarania said the firm will focus on growing its market share in Africa to cut reliance on Kenya, where its legally-guaranteed re-insurance concessions expire next year.

The local concessions guarantee the company 18 per cent of Kenya’s re-insurance premiums.

“We plan to focus on Africa, which is more profitable and is a market we understand well,” said Mr Mwarania at an investor briefing on Tuesday.

Kenya Re offers cover to more than 160 insurance companies spread out in more than 45 countries in Africa, Middle East and Asia, with the Kenyan market accounting for 45 per cent of its business.

The company’s investment income dropped 16 per cent to Sh2.3 billion last year from Sh2.7 billion in 2012 attributed a lower interest rate regime.

Kenya Re said it will complete the transition of its regional office in Abijan into a subsidiary by June, with an eye on the lucrative West African markets such as Senegal and Mali.