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FUGAZ Banks go through N1.9 trillion in CRR Debits in Q2

In total, the CBN now holds a total of N6.57 trillion in CRR debits from the nation’s top 5 banks

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Nigeria’s pinnacle five banks; First Bank, UBA, GT Bank, Access Bank, and Zenith Bank suffered a N1.9 trillion debit in CRR sequesters withinside the 2nd zone of 2020 (April – June).

This is in keeping with data withinside the economic statements of the banks tracked with the aid of using Nairalytics the studies arm of Nairametrics.

Nigeria’s important bank has on the grounds that 2019 debited Nigerian banks a bit in their deposits as a part of a jointly inclusive coins reserve requirement (CRR) and Loan to Deposit Ratio coverage this is centered at coercing banks to lend extra to the personal sector.

In overall, the CBN now holds a complete of N6.57 trillion in CRR debits from the nation’s pinnacle five banks a whopping 43% better than the N4.58 trillion held in March and extra than double the N3.five trillion CRR debits as at December 2020.

According to our records, the pinnacle five banks have a complete purchaser deposit (aside from subsidiary balances) of N18.26 trillion for that reason CRR debits constitute approximately 35.9% of overall purchaser deposits as of June 2020.

CRR Debit with the aid of using banks as at June 2020

  • First Bank, Nigeria’s oldest bank suffered N576 billion debit withinside the 2nd zone of the year alone. First Bank now has a complete CRR debit of N1.6 trillion stored with the CBN.
  • UBA, the Nigerian bank with the maximum African presence suffered a CRR debit of N521.7 billion withinside the zone finishing June 2020. The bank’s overall deposit with the CBN is now N1.5 trillion.
  • GT Bank, Nigeria’s biggest bank with the aid of using marketplace capitalization pronounced a CRR debit of N251.5 billion withinside the zone beneathneath evaluate representing approximately 8.4% of its N2.49 trillion purchaser deposits. The bank now has a complete of N881.6 billion in CRR debits held with the aid of using the CBN.
  • Access Bank pronounced a CRR debit of N158.6 billion, the bottom of the FUGAZ banks withinside the zone beneathneath evaluate. A overall of N1.1 trillion withinside the bank’s purchaser deposits has now been sequestered with the aid of using the CBN.
  • Zenith Bank, Nigeria’s biggest bank with the aid of using earnings suffered a CRR debit of 472.9 billion withinside the 2nd zone of 2020 taking its overall CRR haul to N1.4 trillion. About 9.6% of the bank’s purchaser deposits are held with the aid of using the CBN.

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FINANCIAL SERVICES

Federal High Court directs meeting to consider the transfer of GTBank into a Holding Company

A Federal High Court has directed that a meeting of the holders of GTBank Plc, be convened to consider the transfer of the bank to a holding company.

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The Board of Directors and management of Guaranty Trust Bank has disclosed that the Federal High Court of Nigeria on November 6, 2020, directed that a meeting of the holders of the fully paid ordinary shares of GTBank Plc, be convened on December 4, 2020 for the purpose of considering the transfer of the bank to a holding company.

This information was conveyed through a Notice of Court-Ordered Meeting by the bank, and published on the website of the NSE. It was signed by the bank’s secretary, Erhi Obebeduo, and the Nigerian legal counsel to the bank, Aluko & Oyebode.

According to the information contained in the disclosure, the court-ordered meeting of the holders of the fully paid ordinary shares of Guaranty Trust Bank Plc to be convened for the purpose of considering and if thought fit, approving, with or without modification, a Scheme of Arrangement pursuant to Section 715 of the Companies and Allied Matters Act, 2020 between the bank and the holders of the fully paid ordinary shares of 50 Kobo each in the bank.

The meeting will be held at the Oriental Hotel, 3, Lekki Road, Victoria Island, Lagos, Nigeria, at 10:00 a.m. or soon thereafter, at which place and time the Holders are requested to attend.

Resolutions to be proposed at the meeting

The following are some of the sub-joined resolutions that will be proposed, and if thought fit, passed as special resolution at the meeting:

  • The Scheme of Arrangement dated November 4, 2020, a printed copy of which has been produced for the meeting and, signed by the Chairman be and is hereby approved.
  • In accordance with the Scheme, the 29,431,179,224 ordinary shares of 50 Kobo each in the issued and paid-up share capital of the Bank held by the shareholders be and are hereby transferred to Guaranty Trust Holding Company Plc (the Holdco) in exchange for the allotment of 29,431,179,224 ordinary shares of 50 Kobo each in the share capital of the Holdco to the shareholders in the same proportion to their shareholding in the Bank credited as fully paid without any further act or deed.
  • In accordance with the Scheme and pursuant to the prospectus issued by the Holdco, each existing holder of the Global Depositary Receipts issued by the Bank (the Existing GDRs) receive, as consideration for each existing GDR held, one new Global Depositary Receipt issued by JP Morgan Chase Bank N.A. (JP Morgan Chase), the Depositary Bank for the Holdco GDR programme (the Holdco GDRs).
  • The Board of Directors of the Bank be and is hereby authorised to take all necessary actions to delist the shares of the Bank from the official list of The Nigerian Stock Exchange.

 

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FINANCIAL SERVICES

CBN reviews appointment requirements for CCOs in Banks

The CBN has reviewed the appointment criteria for CCOs in Merchant Banks and Regional Banks.

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The Central Bank of Nigeria has reviewed the appointment criteria for Chief Compliance Officers in Merchant Banks and Regional Banks (Commercial and specialized).

This is according to a circular issued by the apex bank dated October 9, 2020, and signed by its Director of Financial Policy and Regulation Department, Kevin Amugo.

According to the latest notice, Merchant banks and Regional banks are hereby granted dispensation to appoint CCOs on a grade not below an Assistant General Managers. However, the CCOs will report directly to the ECO of the financial institutions who have sole responsibility for compliance matters in the bank.

Backstory

This latest action by the CBN is the sequel to consultations and engagement with stakeholders emanating from its earlier circular referenced FPR/DIR/GEN/CIR/06/004 of September 28, 2016, in which the tentative requirements for Executive Compliance Officers and Chief Compliance Officers of deposit money banks were mooted.

Meanwhile, the requirements and responsibilities of Executive Compliance Officers remain as earlier communicated in the circular dated 28 September 2016.

A part of the recent circular signed by Mr. Kevin read thus,

“Further to the circular referenced FPR/DIR/GEN/CIR/06/004 of 28 September 2016 on the appointment of Executive Compliance Officers (ECO) and Chief Compliance Officers (CCO) of deposit money banks, the CBN has, after due considerations and presentations by stakeholders on the size, structure, operation, and dynamics of classes of operators in the sectors reviewed the requirements for the appointment of Chief Compliance Officers.”

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FINANCIAL SERVICES

CBN grants Greenwich Trust Limited operational license for merchant banking

CBN has upscaled Greenwich Trust Limited to the status of a merchant bank.

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The Central Bank of Nigeria (CBN) has upscaled Greenwich Trust Limited and granted it, operational license for merchant banking in the country.

According to an official statement released by the firm, the entity would be known as Greenwich Merchant Bank Limited. This license allows Greenwich Merchant Bank to upscale and offer such diverse services as corporate banking, investment banking, financial advisory services, securities dealing, treasury wealth and asset management, etc., making it possible to provide increased value to stakeholders beyond its previous scope.

Recall that the minimum capital requirements for establishing a merchant bank according to Merchant Banking Licensing Regulations in 2010 are N15 billion

With the addition of Greenwich Merchant Bank, Nigeria now has six merchant banks. The others are; FBN Quest, Coronation Merchant Bank, DSH Merchant Bank, Nova Merchant Bank and Rand Merchant Bank.

About Greenwich Trust Limited

Greenwich Trust Limited is an investment banking firm duly registered with relevant authorities such as the Nigerian Securities and Exchange Commission (SEC). It is a diversified firm with subsidiaries such as Asset management, GTL Properties, GTL Securities Limited, Cedar Express Limited and Meyer Plc.

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