Rand Merchant Investment Holdings (RMI), which has stakes in Discovery, OUTsurance and UK insurer Hastings, has scrapped its final dividend as Covid-19 has battered financial markets and the insurance industry.

Headline earnings fell 49% to R1.9bn in RMI’s year to end-June, with insurers under pressure amid the cost to lives and jobs from the pandemic.

RMI has a R44.7bn financial services portfolio, including 25% of Discovery, 27.3% of Momentum Metropolitan and 89.1% of OUTsurance.

Discovery had made a R3.4bn provision for future claims and lapses as a result of the pandemic, and also held on to its final dividend for its year to end-June.

Momentum Metropolitan also opted not to pay a final dividend in its year to end-June, when profits about halved amid the pandemic’s effects on claims and policy lapses.

“The heightened medium-term economic and insurance-related uncertainty across the jurisdictions and businesses within the RMI portfolio has necessitated a revision of RMI’s dividend policy,” the group said.

In afternoon trade on Friday, RMI’s share was down 0.89% to R28.90, having fallen 6.29% so far in 2020.


Would you like to comment on this article or view other readers' comments?
Register (it’s quick and free) or sign in now.

Speech Bubbles

Please read our Comment Policy before commenting.