By Chinwendu Obienyi
Nigeria’s largest financial institution, GT Bank Plc, yesterday made history as it successfully transited into a holding company (holdco) structure from its commercial banking structure and listed its shares on the Nigerian Exchange Limited (NGX).
This means that GT Bank Plc will now be referred to as Guaranty Trust Holding Company (GTCO) Plc to the investing community. Furthemore, the bank will adopt a one-for-one share exchange ratio that will not reduce or impact its shareholding structure of the bank.
This transition, according to GTCO will sustainably grow its earnings and achieve its long term goal of becoming one of the top five financial institutions in Africa.
Speaking to newsmen during the closing gong ceremony to commemorate the listing of GTCO Plc on the NGX in Lagos, the Group Chief Executive Officer, GTCO Plc, Segun Agbaje, noted that the company was not oblivious of the current changes in the financial space and added that the transition as well as its listing was done to enhance growth share, value addition and achieve its long term goal of becoming one of the top five financial institutions in Africa.
Agbaje said the experience of trading on the NGX has been really good and noted that GTCO Plc is very excited about the opportunities that have opened up with this restructuring, particularly because diversifying its income base has always been a major priority.
Whilst responding to the Doyen of stockbrokers’ Rasheed Yussuf’s plea to incorporate the synergy between the capital market and money market stakeholders to ensure more injection of funds in the financial system, Agbaje stated that the creation of portfolios was key to anchoring the synergy between the capital market and money market.
He said, “I think we all got spooked after the financial crisis and so we have stopped doing margin loans and leverages one to one. A good financial system must overcome challenges like that and find a way to do safe margin loans and hopefully we learnt something from the past and find a way to go back to doing that as there is no way a stock market can grow if it is only driven by people’s money and so we must find a way to design a leverage again and put it back.
Anchoring the synergy between the capital market and money market stakeholders require many ways or strategies and one of the easiest way is that when you have an asset management tower, you start to create portfolios and your portfolios will have money market instruments or have equities in it and one of the reason for doing this today is to create portfolios with both retail and holdco so that people can go into any one.
I think the reason why we have missed the synergy is that a lot of asset management companies and a lot of investments are not being done on a portfolio basis and people are either investing in either money market or equities and the trick is to design portfolios that have the two (money market and capital market instruments) as regards to risk appetite that will determine the percentages you play with”.
Earlier in his opening remark, the Chief Executive Officer, NGX, Temi Popoola, commended the board and management of GTCO Plc for its successful restructuring while adding that the NGX will continue to partner GTCO and other listed companies and issuers even as it continues to build a platform that allows listed companies, investors and other stakeholders to maximise value in the market.