First Assurance MD out after Barclays deal

Long-serving managing director of First Assurance Stephen Githiga has left the company after Johannesburg-based Barclays Africa acquired a controlling stake in the insurer.

Barclays Africa bought 63.3 per cent shares of the insurance firm last September for about Sh2.9 billion but had retained Mr Githiga as the CEO of the new subsidiary.

Mr Githiga’s departure is a signal that Barclays is keen on gaining a foothold in the insurance market.

“After serving as managing director for First Assurance since 2003, Mr Githiga will be moving on to pursue other interests outside the group,” Barclays Africa’s managing executive for wealth investment management and insurance Lanz Zulu said in a statement.

“We remain grateful to Stephen for his contribution to our insurance business in Kenya over the past 15 years.”

He added that William Maara, the managing director of Barclays Life Assurance Kenya, will fill Mr Githiga’s position in an acting capacity, “fulfilling a dual role subject to regulatory approval.”

Barclays Africa bought a controlling stake in the insurance firm by paying Sh2.2 billion to First Assurance shareholders and an additional Sh700 million as capital injection to grow the business.

READ: Barclays acquires Kenya's First Assurance for Sh2.9bn

The deal saw them acquire a business with five branches in Kenya — two in Nairobi and one each in Nakuru, Mombasa and Kisumu — and another one in Dar-es-Salaam, Tanzania.

Mr Githiga joined First Assurance in 2001 as head of finance and two years later took over as managing director of the company which started life in Kenya as Prudential Assurance Company in 1930.

First Assurance’s shareholding structure has remained a well-guarded secret.

Mr Githiga and six other directors own part of the company through investment vehicle First Assurance Investment.

“I have helped the company grow significantly since I became managing director and I felt that it was time I exited to pursue other interests. I however still remain a shareholder of First Assurance with a four per cent stake,” said Mr Githiga in an interview.

The First Assurance board of directors presently has six members, including Barclays Bank of Kenya’s managing director Jeremy Awori and Sameer Africa managing director Allan Walmsley.

Barclays Life Assurance Kenya (BLAK), a firm that Barclays Africa formed with businessmen Ayisi Makatiani and Darshan Chandaria in April 2015, runs First Assurance’s life business.

The outfit was formed to spearhead Barclays’ entry into an insurance market that is currently dominated by giants such as Jubilee Holdings, Pan Africa Holdings and Britam Group.

First Assurance’s 2014 financial statements (the latest that is publicly available) indicate that it posted a net profit of Sh517.7 million, having grown 37.3 per cent from the Sh376.9 million posted a year earlier.

The insurance firm underwrote gross premiums worth Sh4.4 billion (a 15.7 per cent jump from the 2013’s Sh3.8 billion) while its net assets grew by a quarter to Sh2.16 billion.