The Nigerian Stock Exchange (NSE) last week suspended trading in shares of eight companies due to their inability to file financial accounts as stipulated by the rules of the exchange.
NSE explained that the affected companies were suspended pursuant to Rule 3.1, Rules for filing of accounts and treatment of default filing, which provides that, “If an issuer fails to file the relevant accounts by the expiration of the cure period, the exchange will: send to the issuer a second filing deficiency notification, within two business days after the end of the cure period; Suspend trading in the Issuer’s securities; and (c) notify the Securities and Exchange Commission (SEC) and the market within 24 hours of the suspension.”
Based on the above, the NSE suspended trading in the shares of the eight companies. They are: African Alliance Insurance Plc; Cornerstone Insurance Plc; R. T. Briscoe Plc; Royal Exchange Plc; STACO Insurance Plc; Standard Alliance Insurance Plc; Universal Insurance Company Plc and Veritas Kapital Assurance Plc.
According the exchange, the suspension of the companies will only be lifted upon the submission of the relevant accounts and provided the exchange is satisfied that the accounts comply with all its applicable rules.
The NSE recently fined 17 insurance firms for the delay in the submission of their 2017 full year results. The affected firms were also said to be risking stiffer sanction from the National Insurance Commission (NAICOM) .
The Deputy Commissioner for Insurance (Technical), NAICOM, Mr. Sunday Thomas, had told THISDAY that as of June 20th, 41 out of 58 insurance firms had submitted their 2017 financial results to the commission.
He said out of this, the commission had approved the report of 32 firms while 10 were at various stages of approval. According to Thomas, as at then, 17 firms were yet to submit their results.
Thomas said there was no going back by the commission in the enforcement of penalty for late submission, stressing that there would not be an extension of the deadline for submission of their results.
Going by the laws of the sector, if the firms fail to submit their results on or before June 30th, they would be liable to a daily fine of N5,000 until the day they submit their reports.
But NAICOM is of the view that the fine should be reviewed upward and has been pushing for the amendment of the Insurance Act in that regard.
For some years now, insurance firms have been falling victim of the regulators’ punitive fines, a situation which had caused uproar among their shareholders.
