Shareholders in FBD Holdings are in line for a boost from the insurer which is currently considering what to do with what it has called its “excess capital”.
During FBD Holding’s annual general meeting (AGM) in Dublin today (Thursday, May 11), Tomás Ó’Midheach, FBD‘s chief executive officer (CEO), said that over the coming months FBD would identify “what it is [its] looking to do with a portion of the excess capital”.
Ó’Midheach told shareholders that in light of its “capital strength”, it was FBD Holding’s intention to “engage with stakeholders on steps to return further capital in the short and medium term”.
The CEO said this could take the form of a special dividend or in the form of share buybacks.
A shareholder had questioned when this might take place and the CEO outlined that discussions were currently underway with shareholders and stakeholders and there would be further “clarity” on the issue in a number of months.
FBD CEO’s salary
During the AGM, some shareholders had also raised questions about the CEO’s salary and the pay increase of 8% that he has been awarded in recognition of “his strong contribution since appointment in January 2021”.
According to FBD Holdings’ 2022 annual report, the base salary for the CEO was €500,000 and the bonus for the CEO resulted in a payout of €500,000.
The report also highlighted that a “paypot” of 3.5% was awarded in April 2022 for FBD Holdings’ employees.
Shareholders were informed by the group’s chair, Liam Herlihy, during the AGM that its policy was to “recruit, attract and retain” the best people and in the end, no shareholder opposed the increase in the CEO’s salary.
A total of 13 ordinary and special resolutions were put forward at the AGM and all resolutions were adopted on a show of hands at the meeting.
All of FBD’s directors were also re-elected.
Shareholders also gave the go ahead for a final dividend of 100c/ordinary share for the year ended December 31, 2022.
Underinsured farmers
Meanwhile, FBD Holdings also confirmed that it has contacted farmers to warn them that they could be “under insured” because of building materials inflation.
Ó’Midheach said the group had advised farmers to “consider their level of insurance”.
According to the CEO, farmers had been advised to consider “sums insured” and in particular, in the context of the replacement cost of their shed or home, and to make sure that they had an adequate level of sums insured.
“On the basis that you’ve got very significant building material inflation of up to 50% for steel and wood, people have to consider this,” the CEO added.
“It is a factor, undoubtedly a factor – unless you’re actively considering it then you are in all likelihood uninsured because of inflation.
“Most people are considering this; people are very conscious of this in general.”
He said FBD Holdings had carried out a deep analysis of its customers and a percentage of them appeared to be underinsured by a “significant amount of money and that they needed to do something” about it and were contacted.
He said FBD Holdings had graded this level of exposure from between 50% short to 10% short.
Ó’Midheach said this did not involved an “enormous percentage” of customers and only a relatively small amount of customers were significantly underinsured.
“People make real decisions here. We might contact them and they might say ‘I am a welder and my son’s an electrician and I’m good to go and I’ve made a decision’.
“I’ve been out on farms and people have told me I’m not doing that part of it. So we can do all the analytics and then you ring them up and they’ll say ‘it’s no problem to me’,” he said.
Ó’Midheach said FBD Holdings has urged people to consider their level of insurance because of the current rate of inflation.
During the AGM today, the CEO also underlined the importance of FBD Holding’s foundations – it was formed in the 1960s by “farmers for farmers” – and reassured shareholders that the group was in a strong trading position.
He also highlighted that FBD Holdings was committed to supporting its “customers in their sustainability journey”.