GCR Assigns Leadway Holdings AA/A1+ Ratings, Outlook Stable
GCR Ratings (GCR) has assigned Leadway Holdings Limited national-scale long- and short-term issuer ratings of AA(NG) and A1+(NG), respectively, with a stable outlook.
Leadway Holdings, a non-operating holding company with eight subsidiaries as of 31 December 2025, including Leadway Insureholdings Limited, Leadway Pensure PFA Limited, Leadway Trustees Limited, Leadway Hotels Limited, Leadway Properties and Investments Limited.
Others are Leadway Asset Management Limited, Leadway Health Limited and Ankara Services Limited, collectively referred to as the group. Insurance is the group’s core business and became a wholly subsidiary in Q4 2024 following an organisational restructuring.
The Insurance entities are currently housed under Leadway Insureholdings Limited, which comprises Leadway Assurance Limited, Leadway IARD and Leadway VIE and collectively accounted for 74.1% and 92.0% of the group’s total assets and revenue, respectively, as of 30 June 2025.
Accordingly, the rating for Leadway Holdings reflects the strengths and weaknesses of the group (comprising Leadway Holdings and eight subsidiaries), as well as structural subordination arising from reliance on dividend upstreaming from operating subsidiaries to service obligations.
The ratings also reflect the group’s strong competitive position, robust risk-adjusted capitalisation and an intermediate liquidity assessment. These strengths are partly offset by negative underwriting performance in the non-life insurance business during the review period.
The group’s competitive profile is underpinned by a well-established franchise built over more than five decades of operations, a strong market position in the Nigerian insurance sector, and business diversification across multiple segments of the Nigerian financial services industry.
Leadway Assurance Limited is a leading insurer in Nigeria, with an estimated 12.5% share of the insurance industry’s insurance revenue as of 2024. Leadway Holdings also maintains a presence in Cote d’Ivoire through Leadway IARD and Leadway VIE, providing some geographic diversification, though their contribution to overall revenue remains small.
Beyond insurance, the group has also established a notable footprint in other segments of the Nigerian financial services industry. The pension subsidiary is a mid-tier player in the Nigerian pension industry, with Funds Under Management (FUM) of NGN1.2 trillion as of H1 2025.
The asset management subsidiary also ranks as a mid-sized asset manager, reporting Assets Under Management (AUM) of NGN110.0 billion as of 31 December 2024.
Overall, the group has demonstrated consistent revenue growth over the years, translating into sustained profitability and robust capital accretion.
Over the next 12–18 months, Leadway Holdings’ strong brand name, diversified business model, and extensive distribution capabilities are expected to sustain its competitive position.
“Our assessment of Leadway Holdings’ earnings is positive for the rating”. GCR said. However, it noted that the performance of the core underwriting business during H1 2025 was constrained by heightened claims pressure, particularly within the non-life insurance subsidiary.
Consequently, group earnings were largely supported by investment income and income from non-insurance businesses, including interest income from debt instruments, management fees, dividend income, and fair value gains.
Notably, all subsidiaries reported profitability during H1 2025, reflecting the benefits of earnings diversification across the group despite the underwriting loss recorded within the core insurance segment.
Overall, profitability is strong, with the group’s return on revenue at 36.0% and return on assets at 1.2% in H1 2025, both of which compare favourably with peers.
The group’s earnings profile is considered modest and is expected to remain supported by its operational scale and continued synergies across the various subsidiaries.
Risk-adjusted capitalisation is assessed within a sound range, with the GCR capital adequacy ratio (CAR) of 2.3x as of 30 June 2025, indicating good capital buffers that support the group’s underwriting, market, and operational risk exposures.
Capital quality is also strong, comprising mainly fully paid-up share capital and retained earnings, providing a stable, loss-absorbing capital base. The group’s GCR CAR is expected to remain above 2.0x over the next 12-18 months, supported by continued earnings retention and a prudent investment strategy.
The group’s GCR liquidity assessment reflects an adequate liquidity coverage of 1.3x as of 30 June 2025, buoyed by the dominance of liquid assets in the investment portfolio.
As of the same date, 59.1% of total investments were held in liquid assets, with the balance largely invested in listed equities and other interest-bearing instruments.
Looking ahead, GCR expects liquidity coverage to range between 1.3x and 1.5x over the next 12-18 months, predicated on a consistent investment portfolio allocation to relatively liquid instruments and a good match between the investment pool and the maturity of technical reserves.
The stable outlook reflects expectation that Leadway Holdings will sustain its strong market position despite intensifying competition in the Nigerian insurance industry and other financial services sub-segments.
Additionally, the liquidity coverage ratio and GCR CAR are expected to be maintained above 1.2x and 2.0x, respectively, over the next 12–18 months. However, the earnings profile is likely to remain somewhat pressured by weak underwriting performance. Transcorp Hotels Hits 52-Week High, Tops N2trn in Fresh Breakout
