Companies

Co-op Bank boss raises CIC stake by 6.1m shares

muriuki

Co-operative Bank CEO Gideon Muriuki. FILE PHOTO | NMG

Co-op Bank #ticker:COOP chief executive Gideon Muriuki bought an additional 6.1 million shares in CIC Insurance Group #ticker:CIC in the year ended December, becoming the latest prominent member in the sacco sector to invest more in the company.

The insurer’s latest annual report shows that Mr Muriuki held 137.8 million shares equivalent to a 5.3 percent stake in the review period.

This was up from 131.7 million shares he held in the prior year.

CIC’s chairman Nelson Kuria, who previously led the company as the chief executive, also bought an additional one million shares in the Nairobi Securities Exchange #ticker:NSE -listed firm last year.

His holdings rose to 15.3 million shares from 14.2 million shares but the stake remained unchanged at 0.6 percent.

CIC’s current chief executive Patrick Nyaga holds 12.1 million shares in the company equivalent to a 0.5 percent stake. He bought most of the shares soon after he was appointed CEO in June 2020.

Mr Nyaga was hired from Co-op Bank where he was the director of finance and strategy.

The bank that owns a 24.8 percent stake in CIC earlier said that Mr Nyaga was appointed to turn around the insurer which was in losses at the time.

The bank and the insurer are majority-owned by saccos through various investment vehicles. The share purchases by the stakeholders are seen as a signal of their confidence in the insurer.

Directors are among a group of insiders whose stock buys are followed keenly by investors given that they have better insights into a company’s strategy, growth potential, and competitive position.

Share ownership by directors is also valued as it aligns their interests with those of shareholders, especially if the managers use their own money to buy in the open market.

CIC made a Sh668.4 million net profit in the year ended December, reversing a net loss of Sh296.8 million the year before.

The return to profitability was aided by improved performance across insurance and investment operations and currency movements.

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