Insurance: Moroccan companies bert on Cameroonian market

Last month, in the space of a week, two Moroccan insurance companies announced their arrival in the CIMA zone’s second largest market.

By Brice R. Mbodiam

The second market behind Cote d’Ivoire, out of the 14 that make up the Inter-African Conference of Insurance Markets (CIMA), Cameroon is making waves. After the interest expressed by Ogar, the insurance leader in Gabon, in the Cameroonian market with the purchase of 35% of Chanas Assurances, other countries have stepped up to the podium to show their interest as well in the Cameroonian market which made 154.2 billion FCfa in 2012 (compared to 209 billion for Cote d’Ivoire) based on CIMA’s figures.

The Moroccan insurer, RMA Watanya announced, in March 2014, the acquisition of four companies operating in "three key countries" that fall under the jurisdiction of CIMA, the Central and West African insurance watchdog. The insurance subsidiary of business man Othman Benjelloun’s FinanceCom stated that the three CIMA zone countries were "targeted due to their market share size and their level of development."

Although RMA Watanya has named neither the countries nor the companies that have been acquired, reliable sources have alleged that the acquisitions are the four subsidiaries of the Belife Insurance Groupe out of Cote d’Ivoire, including Beneficial Life Insurance S.A Cameroon and Beneficial General Insurance S.A Cameroon. The Moroccan insurance company allegedly bought 38% of Belife Insurance’s Cameroonian subsidiaries for 3.1 billion FCfa (around 6.2 million dollars) through social capital enlargement. The acquisition line-up is rounded out by Beneficial Life Insurance S.A Togo and Belife Insurance S.A Cote d’Ivoire.


Beneficial holds handing-over general assembly
Only a few days after the acquisitions being announced, including Cameroon’s, the Chairman of the Board at Beneficial Life Insurance SA issued a press release inviting shareholders to two mixed general assemblies on April 2 and 4 in Douala. While the first general assembly focused primarily on "the ratififcation of decisions taken since 1^{st January 2009"}, the April 4 meeting was devoted to "increasing capital and statutory adjustments" explained the Board Chairman’s communiqué in which he revealed an agenda directly influenced by the Cameroonian company asset buy-out by RMA Watanya.

The Moroccan insurance company’s arrival on the two largest CIMA markets (Cameroon and Cote d’Ivoire) as well as the seventh (Togo) confirms the group’s aim "to be present in more than ten African countries by the end of the decade, and to aspire to cumulated sales totalling 400-500 million dollars (200-250 billion FCfa," stated the Moroccan insurance company when it announced the new acquisitions.

Though RMA Watanya is unknown in Cameroon, its parent company, FinanceCom has already been operating in the sector, particularly though its financial subsidiary, the Moroccan Bank for Foreign Trade (BMCE) which has a branch in Cameroon’s economic capital, Douala, and plans to expand there in the years to come.


From Tunisia to Cameroon
RMA Watanya had barely announced its plans to come to Cameroon when its fellow Moroccan company, Wafa Assurance, the insurance wing of the Attijariwafa Banking Group, revealed that it too will be coming to Cameroon. The Moroccan insurance market leader has also just announced green field set-ups in Cameroon, Cote d’Ivoire, Gabon and Congo.

Translation: "For our Sub-Saharan projects, we won’t be doing acquisitions as planned. We will duplicate the approach used in Tunisia, meaning that we will create a new entity," announced Mohamed Ramses Arroub, CEO of Wafa Assurance during the presentation of the company’s 2013 results. In short, the Moroccan insurance company which previously had acquisitions planned for certain countries has changed strategy following the success of Wafa Assurance’s green field set-up in Tunisia.

Indeed, according to the Moroccan insurance giant, in the space of 7 months of activity, Wafa Assurance’s Tunisian subsidiary, a specialist in life insurance, made 89.6 million Moroccan dirhams in sales and bit off around 7% of market share by using the Attijari-Bank Tunisie network, Attijariwafa Bank’s local subsidiary.

These results are achievable in Cameroon where the insurance penetration rate is still very low, and where Attijariwafa Bank has bought assets in Société commerciale de banque (SCB). This banking establishment has an excellent record and is expanding its network by creating new agencies.

Wafa Assurance’s strategic shift, which prioritises creating a Cameroonian subsidiary from scratch instead of buying assets in an existing company, is good news for job hunters as the creation of a new company that aims to expand rapidly to conquer the market, goes hand in hand with job creation.

Source Business in Cameroon