Sanlam Earmarks $279.8 million For African Growth Prospects

Sanlam, South Africa’s second biggest life insurer, on Wednesday said it had set aside R3 billion ($279.8 million) for growth prospects in Africa and South East Asia for this year and beyond.  Sanlam said at the end of the last financial year, it had more than R4 billion ($373 million) on hand meant for redeployment in these opportunities.

Since then a total of R1.6 billion ($149.2 million) had already been used, including R1.3 billion ($121.2 million) for the acquisition of a 51 percent stake in Malaysia’s MCIS Insurance.  The other R300 million ($27.9 million) was used to buy a further 2.4 percent shareholding in its Botswana operations and to fund increased capital necessities of specific non-life group units.

Sanlam made this disclosure on Wednesday as it released its operational update for the first four months of the year.  During the period under review, Sanlam saw new business volume surge 21 percent to R59 billion ($5.5 billion).  This was a robust performance given the tough operating conditions during the period under review.  The performance was boosted by higher “average investment market levels” and marked improvement in Santam’s underwriting margin.

South African insurance firms have large amounts of money invested in the equity markets. If the markets do well, the company’s top line earnings growth also becomes evident.  Santam is South Africa’s biggest short term insurer and it is a subsidiary of Sanlam.

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