Access Bank holds court-ordered meeting as Shareholders approve HoldCo structure
L-R: Dr. Herbert Wigwe, GMD/CEO, Access Bank Plc; Dr. Ajoritsedere Awosika, Chairman, and Mr. Sunday Ekwochi, Company Secretary, at the Court Ordered Meeting for the proposed restructuring of Access Bank Plc and other related group companies into a new non-operating holding company in Lagos… yesterday.
By Samson Bakare
Access Bank held its Court-Ordered Meeting of Shareholders Thursday, in Lagos where Shareholders of Access Bank Plc unanimously approved the restructuring of the Group into a non-operating financial holding company structure, Access Holding Company.
At the meeting, shareholders of the financial institution voted in favour of the corporate reorganisation, which would result in shareholders holding shares in the Holdco in the same proportion as their current holdings in the Bank and the Bank’s shares being held wholly by the Holdco, which will be a regulated entity for CBN purposes.
In her submission, the Chairman of the Bank, Dr Ajoritsedere Awosika stated that the meeting conveyed was pursuant to the order of a Federal High Court on the 19th of November, 2021 to enable shareholders to consider the proposed Scheme of Arrangement.
According to the Chairman, the reason for the scheme includes limiting the exposure of banks to higher operating risks and reducing the propensity to put depositor’s funds to risky non-banking businesses.
Also, the Hold Co structure will ring-fence each business from the risk of the other by preventing the business performance of one business from affecting the performance and evaluation of another. Under the structure, she continued, the assets of the bank are ring-fenced from the non-banking business.
The scheme will result in shareholders holding shares in Hold Co in the same proportion as their current holdings in the bank and the bank’s shares being held wholly by the Hold co which will be a regulated entity for CBN purposes.
The Managing Director of the Bank, Herbert Wigwe, commented on the scheme saying that “the scheme symbolizes a great future that the company wants to create. We have to continuously evolve and create a construct that will ensure that there is proper oversight over the subsidiaries.”
He further states that this move shows that the institution is evolving into a larger and different type of institution that will try to optimize and provide greater values to shareholders as it moves to the next level.
He mentioned that there will be boards at the subsidiary levels (for all subsidiaries), at the bank level, and also at the Holding company level to ensure that best practices will be followed and stringent governance standards will be maintained to avoid conflicts
In similar vein, the President, and Association for Advancement of Right of Nigerian Shareholders Dr Faruk Umar, Dr Faruk Umar, applauded the move of the Bank to become a holding company while noting that the diversification was a welcomed one which would take the financial institution to greater heights given the manner the board had managed the bank so far.
He noted that the diversification would bring more profitability to the institution, given the quality of the members of the board, thus more returns for the investment of shareholders.
Also, the Chairman, Pragmatic Shareholders Association of Nigeria, Mrs Bisi Bakare appreciated the board and management of the bank for proposing under the restructuring scheme to give shareholders one HoldCo share in exchange for every one scheme share, which would be transferred to the HoldCo without any further act or deed by shareholders.
Similarly, the , National Chairman, New Dimension Shareholders Association, Patrick Ajudua, said the new development would be of great value to the bank, the shareholders and all stakeholders, adding to despite the security situation of the country and other parameters, the bank would achieve its objectives of group.
