Business
Sovereign Trust Retains GCR A-Rating
Sovereign Trust Insurance Plc has for the third time bagged an A-Rating from GCR (Global Credit Rating), the reputed South African Rating Agency. This was the out come of the latest rating exercise carried out by the renowned agency.
According to a statement released by the corporate communications and Brand Management Department of the organisation, the rationale used by GCR in arriving at the rating includes solvency and liquidity, claims paying ability, capital adequacy, peer to peer performance comparison amongst others.
GCR in its rating observed that Sovereign Trust Insurance Shareholders’ Fund is above the minimum statutory requirement for insurance companies in the country, while its investment port-folio has supported overall profitability in the last five years generating good investment returns.
The company’s liquidity is also considered strong with a consistent improvement in Net Profit After Tax (NPAT).
Even though it was observed by the rating agency that there was a lull in premium collection industry –wide, the company stands to be commended for the efforts in ensuring that business booked by brokers and direct customers are paid for on a timely basis. The insurer’s maximum net retention on oil & Gas (W1) under-writing was quite impressive with a variable multi-linc reinsurance package.
When compared to its peers, the company’s solvency is considered adequate while its loss ratio, Gross Premium Income (GPI), Wet Premium Income (NPI) and profitability competes favourably well with its peers.
Due to its proactive nature, Soveragign Trust Insurance Plc has attempted to diversifying from the predominantly brokers driven market by deriving a portion of its business from agents and direct marketing initiative. As a fall-out of this, the company has attempted to increase its market share with the introduction of a pan-Nigeria agency system with a view to having a more robust market share in the industry.
A breakdown of the company’s GPI (Gross Premium Income), showed that Motor Insurnace remained the largest contributor with 31.4 per cent closely followed by Engineering Insurnace with 30.1 percent, General Acident Insurnace, Fire Insurance and Transport Insurance all contributed 17.2 per cent, 11.9 per cent and 9.4 per cent respectively.
Gross Premium Income has grown over the last three years at a compound rate of 64 per cent while the net commission rate has increased from 15 per cent in 2007 to 18 per cent in 2008. The report also showed that halting further expansion by the company in the last quarter of 2008 has impacted positively on the compnay’s performance.
Conclusively, the Global Credit Report submitted that Sovereign Trust Insurance Plc has experienced growth through its aggressive marketing strategy, strong commitment to cooporate brand management as well as its increased branch network and participation in oil and gas business.
The company’s investment in the capacity building of its workforce through local and foreign training coupled with the upgrade of its Information Technology (IT) platform are also notable development strategy which could help the firm compete favourably with major players in the industry in the years ahead.
Credit to Nigeria’s private sector rose to N83.26 trillion in June 2026 from N81.04 trillion in May, signifying a positive balance of N2.22 trillion month-on-month.
Year-on-year, the figure represents a nine per cent increase compared with the N76.13 trillion recorded in June 2025. The latest figures come as the CBN continues to balance efforts to control inflation with the need to support economic growth and expand credit to businesses.
The CBN data shows that credit to Nigeria’s private sector increased by approximately 2.74 per cent month-on-month between May and June 2026. Also, the CBN data noted that credit to the government fell slightly to N40.03 trillion from N40.38 trillion. Other assets, net, dropped to N10.76 trillion from N12.63 trillion.
The credit surge signifies sustained growth in lending to businesses and other private-sector borrowers during the month. The rise in private sector credit was recorded alongside an increase in net domestic credit, despite declines in credit to government and other assets.
Further analysis of the report says that compared with June 2025, private sector credit rose by about N7.13 trillion yea-on-year but net domestic credit increased by approximately N1.87 trillion during the month.
The CBN’s relatively tight monetary policy stance notwithstanding, more banks still loaded funds to the private sector within the period. The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) held its 306th meeting on July 20 and 21.
The Committee reviewed recent developments in the global and domestic economies, assessed emerging risks to the outlook and considered their implications for monetary policy and retained all rates.
The Committee decided to retain the Monetary Policy Rate at 26.5 per cent; the Standing Facilities Corridor around the MPR at +50/-450 basis points and retain the Cash Reserve Requirement (CRR) for Deposit Money Banks at 45.00 per cent, Merchant Banks at 16.00 per cent, and non-TSA public sector deposits at 75.00 per cent.
The MPC decision means that credit extension in the private sector will likely continue to rise because of rising confidence in the sector and calls by stakeholders for banks to invest in the private scetor instead of government securities.
