By Udeme Ekwere

Friday, 22 Oct 2010

Shareholders of Guaranty Trust Bank Plc have given their approval to the divestment of the bank from its subsidiaries.

This is following the Central Bank of Nigeria‘s directive abolishing universal banking,

With the approval, given at an Extra ordinary General Meeting held on Thursday, the bank would function without three subsidiaries- Guaranty Trust Assurance Plc, GTB Asset Management Limited, and GTB Registrars.

However, it will merge with another of its subsidiaries, GT Homes.

Speaking at the EGM, the Chairman, Mr. Oluwale Oduyemi, stated that the board recommended divestment rather than the floating of a holding company because of the strategic implication on the GT Bank Group.

He said, ”After due consideration of our core strengths, your directors are of the opinion that the most optional means of ensuring compliance with the CBN directive whilst simultaneously facilitating further growth and value creation for the shareholders, is to concentrate the bank‘s financial and management resources on commercial banking.

”Upon completion of the divestment, the bank shall apply for a commercial banking licence (with 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 offshore banking subsidiaries in the West African sub-region and the United Kingdom.

Meanwhile, investors in the Nigerian Stock Exchange have lost a total of N182bn in the last three trading days.

Specifically, the market capitalisation of the 199 listed equities fell from N6.19tn on Monday, to close at N6.012tn on Thursday, translating into a loss of 2.9 per cent or of N182bn for investors.

The NSE‘s All-Share Index closed at 24,537.02 points representing a loss of 741.21 points or 2.9 per cent in the period under review.

Analysts traced the consistent decline to the profit taking activities of investors, who still maintain fragile confidence in the market.

Blue-chip stocks continued to post significant losses, with Mobil Oil Nigeria Plc recording the highest loss of 2.5 per cent or N3.40 to close at N134 per share.

Nigerian Bottling Company Plc and Flour Mills Nigeria Plc lost 4.9 per cent and 2.1 per cent to close at N31.83 and N69.50 per share respectively.

Conoil Plc recorded the highest gain, rising by five per cent or N1.89 to close at N39.79 per share.

Source: Punch