The Nigerian Exchange (NGX) Limited at the weekend suspended trading on the shares of GTBank, citing the impending transition of the bank. With the suspension, there will be no trading or share price movement throughout the period leading to the delisting of the GTBank and relisting of the holdco.
According to the NGX, the step it took was necessary to prevent trading in the shares of the bank in preparation for the eventual delisting of GTBank from the Daily Official List of the Nigerian Exchange Limited (NGX) and listing of the holding company, Guaranty Trust Holding Company Plc on NGX.
The bank will adopt one-for-one share exchange ratio that will not reduce or impact its shareholding structure of the bank.
Shareholders of GTBank had approved the restructuring of the bank to a holdco. The approval paved way for GTB to conclude transition from a standalone commercial bank to a group structure that allows it to invest in other areas of financial services or other businesses.
At the court-ordered meeting in Lagos, shareholders approved the transfer of issued and paid up capital of GTBank totalling 29.431 billion ordinary shares of 50 kobo each to a new company to be known as Guaranty Trust Holding Company Plc. The new company, Guaranty Trust Holding Company (GTHoldings) Plc, will simultaneously allot the same 29.431 billion ordinary shares of 50 kobo each to the former shareholders of GTBank in accordance with their shareholdings in the bank.
Managing Director, Guaranty Trust Bank (GTB) Plc, Mr. Segun Agbaje said the adoption of holdco was necessitated because of Central Bank of Nigeria’s (CBN) regulations, which require the separation of commercial banking business from other financial services businesses.
He explained that under the new structure, shareholders of GTBank would be migrated to Guaranty Trust Holdings through a share-for-share exchange between the shareholders of GTBank and GTHoldings.
According to him, the overall strategy was to create an operating model that would profitably grow the bank’s presence in the market for commercial banking and non-banking financial services in order to achieve the aspiration to be the dominant financial services group.
“I am delighted over the approval by shareholders for the holding company and I assure the investors of a more rewarding future. The bank will not embark on any share reconstruction as the same number of shares they have with the bank will be maintained,” Agbaje said.
Shareholders were excited about the transition to a holdco structure.
Founder, Independent Shareholders Association of Nigeria (ISAN), Sir Sunny Nwosu said the shareholders were excited because the arrangement the bank has put in place for the transition to holdco was devoid of complexities usually known as share reconstruction.
“We are excited about the development because we are going to get value as everything we have would be transferred to the holding company. There will be no manipulation as a result of reconstruction that usually leads to fractional shares,” Nwosu said.
President, Progressive Shareholders Association of Nigeria (PSAN), Mr. Boniface Okezie, said GTBank has over the years proven to be a force and leading initiator of revolutionary advancement and technology-based development in the nation’s banking industry.
He said shareholders would be looking forward to the growth and advancement the bank will bring into the new business areas it will be taking on with the holdco structure.
“The arrangement where all existing shares of the bank would be transferred entirely to the holdco in the name of the beneficial owners is good, while the same number of units and percentage would be held in the new entity, is commendable,” Okezie said.