Shareholders Endorse New Commercial Banking Structure For UBA

Shareholders of United Bank for Africa (UBA) Plc have approved the internal restructuring and reorganization of the capital of the Bank and its members in compliance with the Central Bank of Nigeria (CBN)’s Regulation on the Scope of Banking Activities and Ancillary Matters, which repealed the universal banking model under which Nigerian banks operated.

 

Shareholders convened at a ‘Court Ordered Meeting’ held Thursday at the Harbour Point, Victoria Island, Lagos and unanimously approved the adoption of a commercial banking structure by divesting all non-commercial banking businesses of the Group which are now to be held separately from UBA Plc by the Bank’s shareholders.

Under the new arrangement, the divested non-commercial banking businesses (except Africa Prudential Registrars and Afriland Properties that will be held directly by shareholders) will be consolidated within UBA Capital Plc, which today is one of the Bank’s subsidiaries. The restructuring will result in the emergence of four separate standalone companies namely, UBA Plc, UBA Capital Plc, African Prudential Registrars Plc and African Properties Plc.

Chairman of the Bank, Chief Israel Ogbue while listing the benefits of the proposed structure said it would enhance UBA’s corporate governance practices as there will be dedicated board and management focus on the core business of commercial banking. He added that the structure will ensure the protection of shareholder value noting that in designing the new structure, care has been taken to ensure that the potential concerns of all stakeholders are addressed, particularly shareholders of UBA Plc.

Explaining the rationale behind the new structure, the Group Managing Director/Chief Executive Officer of the Bank, Mr. Phillips Oduoza, said that the board decided to adopt a commercial banking structure that would lead to more value for shareholders, noting that under the scheme of arrangement, “Both UBA Capital Plc and Africa Prudential Registrars Plc will be listed companies on the NSE on day 1; hence, eligible shareholders will have the benefit of owning liquid stocks in these entities while Afriland Properties will be listed at a much future date.”

According to him, Africa Prudential Registrars Plc and Afriland Properties will be spun-off to the eligible shareholders in line with the CBN’s directive to banks to divest from such businesses.

National Coordinator of Nigerian Shareholders Solidarity Association (NSSA) Sir Sunny Nwosu commended the board for taking the initiative to restructure the bank adding that it will also protect shareholders&#39 value and will lead to increased capital market valuations.

Also, Farouk Umar, President, Association for the Advancement of the Rights of Nigerian Shareholders (AARN) supported the board’s opinion that the restructuring will result in greater value and provide each entity with easier access to long term capital to finance growth, thus protecting shareholders&#39 value.

The UBA Group is an outstanding industry leader in commercial and retail banking across Africa with operations in 19 African countries as well as in 3 global financial centres (New York, London & Paris) serving over 7 million customer accounts through multiple channels and remote locations.

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