NobleOak advances plans for ASX listing with research release

Life insurance group NobleOak is pushing ahead with an ASX-listing, via the release of IPO analyst research and fund manager meetings.

NobleOak joins the ASX IPO pipeline. Picture: NCA NewsWire/Gaye Gerard

Life insurance manufacturer and distributer NobleOak is pushing forward with an ASX-listing, kicking off the release of initial public offering analyst research and fund manager meetings.

Sources said NobleOak’s adviser investment bank Barrenjoey would release analyst research on the company as early as Thursday to coincide with meetings with potential investors. Nick McGarrigle, a Barrenjoey founding principal and emerging companies analyst, has been working on the IPO analysis.

It’s an interesting time for a life insurance group to be pursuing a listing, given the industry has been on the nose since a spate of compliance issues were raised at the 2018 Hayne royal commission. The prudential regulator has also intervened in the sector to stem “ongoing heavy losses” in individual disability income insurance.

Fund managers will want to understand NobleOak’s strategy and how it can grow when players including the big banks and AMP have retreated from the industry, due to capital intensity and greater regulatory scrutiny. Westpac is the last of the major banks in life insurance and it has a sale process for the division underway.

NobleOak’s website describes it as an independent Australian life insurer with more than 140 years of history.

In its 2020 annual report NobleOak’s chairman Stephen Harrison said it was growing “from strength to strength”, despite a very challenging market.

“In 2020, NobleOak delivered strong growth in a low growth environment which was subject to widespread disintegration of community trust,” he said in the report.

“NobleOak is well positioned to take advantage of this disruption and further grow our business. There is no doubt that industry headwinds will continue to emerge in the coming year, but the board believes we are well placed to deal with these while further building shareholder value.”

The life insurer reported a fiscal 2020 consolidated net profit of $7.6m, up from $5.2m in the prior year, the annual report showed. Normalised 2020 before tax profit printed at $8m. Net insurance premium revenue rose to $36.2m from $26.9m, but investment income fell.

The annual report said as at June 30 the company had capital above its target level, although would look to raise capital in 2021 in conjunction with a listing, subject to market conditions.

NobleOak’s chief Anthony Brown – who has led the group since 2012 – penned in the annual report that staff numbers had grown to 130.

No dividends were paid for the 2020 year.