ByPeter Egwuatu
Shareholders of Guaranty Trust Bank (GTBANK ) Plc have endorsed proposed plans by its Board of Directors to divest from non banking subsidiaries in compliance with the new directive by the Central Bank of Nigeria (CBN).

The shareholders at the Extra Ordinary General Meeting (EGM) held on Thursday in Lagos approved that the Bank should hand-off from its subsidiaries and face its core banking services.

Other proposed endorsement by the shareholders at the EGM include: Authorising Board of Directors to facilitate equity investment of the Naira equivalent of US$30, 000,000 by the International Finance Corporation(IFC) through the issuance and allotment of an appropriate number of ordinary shares of 50 kobo each at a price per share to be determined on the basis of the volume weighted average closing prices derived from the Daily Official List of the Nigerian Stock Exchange (NSE); Increase in authorised share capital of the company from N15 bllion to N25 billion by creation of additional 20 billion ordinary shares of 50 kobo each; Amendment of Memorandum and Article of Association and deleting of Clause 6 of the Memorandum and Article 5 of the Articles, and substituting for each of the said Clause and Article.
The shareholders also approved that the share capital of the company be fixed at N25 billion divided into 50,billion ordinary shares of fifty kobo each ranking in pari passu in all respects with the existing ordinary shares of the company.

It will be recalled recently, the CBN through a circular dated September 7, 2010, repealed the universal banking guidelines and released a new licensing regime under which the CBN shall only issue licenses for commercial , merchant, specialised and non interest banking. The directive further requires banks to divest from, and prohibits their participation in, non banking business.

Speaking at the EGM, Chairman of GTBANK, Mr. Oluwole Sunday Oduyemi explained to shareholders that given the new guidelines by the CBN, the Bank will now concentrate on commercial banking.

According to him, “ this proposition shall therefore entail the divestment of the Bank’s shareholding interests in the following non-banking subsidiaries- Guaranty Trust Assurance Plc, GTB Asset Management Limited, and GTB Registrars Limited, and a proposed scheme under the provisions of the Investments & Securities Act, No. 29, 2007 to effect a merger of the assets, liabilities and undertakings of the mortgage banking subsidiary- GTHomes Limited -with the Bank”.

He further stressed that upon completion of the divestment, the GTBANK  shall apply for commercial license with an international scope from the CBN in order to facilitate the continuation of its commercial banking operations both on a national scale in Nigeria and through its offshore banking subsidiaries in the West African sub-region and the United Kingdom.

“ Overall, your directors shall take all steps possible to ensure a fair, transparent and independently managed divestment process, with the ultimate objective of enhancing the Bank’s capacity to take advantage of existing and emerging opportunities within the scope of the permissible activities under the new commercial banking licencing regime” Oduyemi declared.