With the aspiration of dominating Sub-Sahara Africa financial service sector in the next five years, Nigeria’s oldest bank, First Bank of Nigeria Plc, has changed its operating system from a commercial bank to a holding company – First Bank Holdings Plc.
To cement its restructuring program, the bank has delisted from the Nigeria Stock Exchange (NSE) under its former name and is now listed as First Bank Holdings Plc on the financial services sector of the Nigerian bourse. It delisted last week after relevant approvals has been met after which an Extraordinary General Meeting (EGM) was held on 24 September, 2012 to seek the approval of its shareholders.
All this is done in compliance with the Central Bank of Nigeria’s (CBN) regulation which requires the separation of commercial banking business from other financial services businesses.
The company listed 32.6 billion ordinary shares of 50 kobo each at N15.05 per share on the bourse.
While addressing Stockbrokers on Monday, at the bank’s ‘Fact behind the listing’ at the NSE in Lagos; Chief Executive Officer of First Bank Nigeria Holdings (FBN), Bello Maccido, said the new structure would enhance service delivery, group’s competitiveness, performance and profitability for the group’s customers, shareholders and investors. It would also help streamline and coordinate various operations across non-bank financial services, and further exploit opportunities for synergies between subsidiaries.
“It is a good thing because through this new structure, we have been able to retain many good investments that we have made. We are able to retain a lot of our subsidiaries that have future promises for significant values for shareholders while some other ones, based on CBN directives we have to sale,” Maccido said.
The FBN Holdings comprised First Bank of Nigeria Ltd, FBN Capital Ltd, FBN Life Assurance Ltd, FBN Insurance Brokers Ltd and FBN Microfinance Bank.
“What we now have is a structure that has the potential to do much more for our customers and protect and preserve shareholders’ value through retention of good investments. The holding company structure promises enhanced service delivery, performance and profitability for the group’s customers, shareholders and investors.
“We have created an operating model that will drive service excellence and profitably grow the group’s presence in commercial banking and non-banking financial services in order to achieve the aspiration to be the dominant financial services group in Sub-Saharan Africa within the next five years,” he added.
Maccido said that the customers of the group’s banking and non-banking subsidiaries would continue to experience the service in keeping with the First Bank’s culture.
He stated that the shareholders of the holding company would benefit from all businesses in the group.
Maccido however said that the restructuring of the company does not change the rights and ownership of the existing shareholders of First Bank of Nigeria Plc – rather their shareholding would be transferred to FBN Holdings through a one for one share exchange.
“So far, every one share you own in First Bank, you are now giving one share in FBN Holding. It is a migration that is done based on one for one share transfer and that does not erode any value,” he explained.
On the issue of the registrar and real estate business, Maccido stated that the FBN Holdings Plc would be divesting from its registrar business which would be sold in order to extract maximum value to shareholders while the other 12 subsidiary companies, including the mortgage and real estate financing would be part of the new entity.