By Omodele Adigun

The Shareholders of Access Bank Plc last Thursday unanimously approved its Board’s resolution to restructure the banking Group into a non-operating financial holding company.

At its court-ordered Extra-ordinary General Meeting (EGM), the investors also approved the transfer of the 35 billion, 545 million, 225 thousand, 622 ordinary shares of 50 kobo each in the issued and paid up share capital  of the bank to Access Holding Plc in exchange for the allotment of 35 billion, 545 million, 225 thousand, 622 ordinary shares of 50 kobo each in the share capital of Holdco to the shareholders in proportion to their shareholding in the bank, credited as fully paid without any further act or deed.

Giving justification for the restructuring, its Chairman, Dr (Mrs) Ajoritsedere Awosika, said Access Bank decided to transit to a financial holding company in line with seven main considerations, which included compliance with the CBN’s Regulation on the scope of Banking  Activities and Ancillary Matters (Regulation 3) 2010, (which repealed the Universal Banking and limited the ability of banks to undertake non-banking business), and Guidelines for Licence and Regulations of Financial Holding companies in Nigeria, 2014.

She added: “The Holdco structure will enable Accesss Bank diversify its business    portifolios into new areas within the financial service industry that are permissible  by the CBN Holdco regulations; the HoldCo structure will expedite capital and liquidity provide flexibility to accommodate leverage with minimum risk to regulatory ratio.”  

Corroborating  Mrs Awosika, the Group Managing Director/CEO, Dr Herbert Wigwe, promised a better deal for both the staff and shareholders of the bank in the new dispensation. He stated:

“When we started the bank in 2002, the institution restricted itself to the narrow banking definition. And so we keep ourselves to the proper commercial bank. Then we were one of the smallest bank in the country. The institution has grown beyond all these things. Today, in terms of total assets; in terms of total customer base, we are the largest bank in the country. Even the very presence of the bank in several countries requires a different organizational structure to handle all of those things. If anybody tells you that there is one Managing Director who will oversee 20 or 30 countries, it is a lie. So we have to continually evolve and create a consort that will ensure a proper oversight over the subsidiaries.

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Non-banking subsidiaries

“Apart from just moving money from one pocket to the other, what it shows is that the institution is evolving into a larger and different type of institution that will try  to optimise and provide better value to shareholders as it moves on to the next level.

Board

“In terms of governance framework, the restructuring of the company introduces another layers on board. And in terms of having additional board compared to a weaker governance framework, I don’t think there is any basis for comparison. At the subsidiary level, you will have a board; at the bank level, you will have a board and at the HoldCo level, you will have a board; same thing for the other subsidiaries that would be created. We will follow best practice and very stringent governance standard to avoid conflict.Shareholders

“We will never ever shortchange our shareholders. People think that it is the large shareholders that matter. But let me tell you something: If you have poor people invest, any attempt to disenfranchise them, you will always get the reward at some point in your life. If you have a billion Naira investment, that person that invested one Naira means the same thing.

“We will continue to engage shareholders; we will continue to engage minority shareholders; to make sure that the decision we take will make optimal profit to everybody. I want to reassure everybody that we will basically engage all shareholders. However, my appeal to the shareholders is to always take a long -term view of where we are headed. When we started the bank in 2002, we were one of the smallest bank in the country. Today, in terms of total assets; in terms of total customer base, we are the largest bank in the country.And so we need to retain cost and support our growth. We will pay staff well and make sure shareholders are well compensated as well.”