The Nigerian Exchange (NGX) Limited last week listed Guaranty Trust Holding Company Plc (GT HoldCo) after delisting Guaranty Trust Bank Plc.
The entire 29,431,179,224 issued shares of GTB were delisted while GT Holdco’s entire issued share capital of 29,431,179,224 ordinary shares of 50 kobo each were listed on the bourse.
The NGX had penultimate week suspended trading in the shares of GTBank in preparation for the delisting and listing of GTHoldCo pursuant to the Scheme of Arrangement between the bank and its shareholders.
In November 2020, Guaranty Trust Bank (GTBank) had notified NGX that it had obtained regulatory approval-in-principle (AIP) to restructure into a financial holding company (Holdco), which was approved later by the bank’s shareholders.
The Managing Director of GTBank, Mr. Segun Agbaje, had said the transition into a holdco was a necessary step to future-proofing their leadership position, sustainably growing their earnings and achieving their long-term goal of becoming one of the top five financial institutions in Africa.
“ It is also a critical part of our response to the seismic shifts in customer expectations and changes in business models. As a holdco, we will compete more effectively with non-banks in the new competitive landscape, pairing our strength in financial services with an aggressive focus on creating value in every aspect of our customers’ lives,” he said.
GTBank plans to diversify into payment service banking (PSB), asset management business and pension fund administration (PFA) without any distractions to its core banking business.
Commenting on the development, a portfolio analyst at Comercio Partners, Afolabi Ogunlayi, said the holdco company was likely to go through an inorganic expansion route for the asset management and pensions arms, making Investment One Financial Services a likely target in this regard.
According to him, the bank currently has the financial muscle to effectively leverage the asset management business, while its large staff and customer base should be the starting point for its pensions market penetration strategy.
However, Ogunlayi noted that that investors should expect the value of the holdco strategy to become apparent in the long term, after the impact of the new business lines feeds into the group’s numbers and props up its performance.
The analyst further adds that, while the pathway is not completely clear at the moment, the sentiment around the stock is great, and investors should see an improvement in the long-term intrinsic value.