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Access Bank Shareholders Vote 100 In Favour Of HoldCo Structure

Shareholders of Access Bank Plc, Nigeria’s leading bank will be presented with the scheme of arrangement to restructure the bank to a holding company for approval at the Court-Ordered Meeting on December 16, 2021, bank said in a notice at the Nigerian Exchange last week.

The notice said the meeting will be held at Access Bank Plc’s Head Office.

Specifically, the restructuring is proposed to be implemented through a scheme of arrangement pursuant to the provisions of Section 715 of Companies and Allied Matters Act (CAMA) and the SEC Rules and Regulations,” the notice said.

If the Restructure is approved, the restructured group will have a structure like that of some major global financial institutions, including those that Access Bank considers to be its peers and competitors.

The Board expects that the restructured group will have greater flexibility to adapt to future business opportunities, market and regulatory changes than is currently the case.

Specifically, the restructuring is proposed to be implemented through a scheme of arrangement pursuant to the provisions of Section 715 of Companies and Allied Matters Act (CAMA) and the SEC Rules and Regulations,” the notice said.

If the Restructure is approved, the restructured group will have a structure like that of some major global financial institutions, including those that Access Bank considers to be its peers and competitors.

The Board expects that the restructured group will have greater flexibility to adapt to future business opportunities, market and regulatory changes than is currently the case.

Other considerations  include diversification into permissible financial services: The HoldCo structure will enable Access Bank to diversify its business portfolios into new areas within the financial service industry that are permissible by the CBN HoldCo regulation; Risk management: The HoldCo structure would ring fences each business from the risks of the other, by preventing the business performance of one business from affecting the performance and valuation of another, Accordingly, under the HoldCo structure, the assets of the bank are ring-fenced from the nonbanking businesses; Ease of funding: The HoldCo structure will facilitate a consolidated financial strength of the Group, which will improve access and ability to raise capital with benefits including lower transactions costs, amidst others;  Capital allocation: The HoldCo structure will expedite capital and liquidity, and provide flexibility to accommodate leverage with minimal risk to regulatory ratios; and Speed of decision making: This structure would unburden the Bank from oversight functions and responsibilities of managing the subsidiaries and ensure the Bank is solely focused on its core operations. This fosters faster decision-making and business growth.

“The Board considers the Restructure to be the most appropriate approach to create greater strategic flexibility and diversification of the Group’s revenues,” she said.

Source: tribuneonlineng.com

 

 

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