Shareholders have overwhelmingly endorsed the new holding structure of the United Bank for Africa (UBA) Plc, the pan African financial services Group with presence in 19 countries across Africa. At the meeting held in Lagos yesterday, shareholders unanimously approved the plan for the group to operate the new structure. A non-operating company is to be listed and known as UBA Holdings Plc and would become the parent company of three intermediate holding companies namely; United Bank for Africa Plc, UBA Africa Holdings Limited and UBA Capital Holdings Limited.
The United Bank for Africa Plc would hold the Nigerian commercial banking businesses, including the Bank’s branch in New York, UBA Pensions Custodian and UBA FX Mart; UBA Africa Holdings Limited would hold and oversee all the African commercial banking businesses excluding Nigeria, while the Groups investments in non-commercial banking businesses would be held by UBA Capital Holdings Limited in the new arrangement.
Also, UBA Plc would remain a listed entity on the Nigerian Stock Exchange and existing shareholders would cede 60 per cent of their holding in UBA Plc for 100 per cent ownership of UBA Holdings Plc. In addition, UBA Plc will divest its ownership of African banking and non-commercial banking subsidiaries to UBA Africa Holdings Plc and UBA Capital Holdings Plc; these two entities would in turn be wholly owned by UBA Holdings Plc.
The restructuring by UBA is sequel to the approvals-in-principle obtained from the Central Bank of Nigeria (CBN) and Securities and Exchange Commission (SEC) respectively.?? The rationale for the change in the current structure is to align the ownership and operation of the Group with the new licensing regime of the CBN.
According to the group managing director, Mr. Phillips Oduoza, “this new move will eliminate duplication across business lines, whilst improving overall coordination. The assets of the commercial banking business in Nigeria will be ring-fenced from the other businesses.”
The restructuring of UBA into a financial service holding company does not affect the bank’s current relationship with customers as it only relates to the re-organisation of entities within the Group.? “The terms and conditions of our existing contracts and obligations shall remain valid,” said Mr. Oduoza.
Executive director, Group Executive Office, Mr. Emmanuel Nnorom, said the Holdco structure would create a unique platform for a broader range of business and service offerings to entrench the Group’s market competitiveness and allow respective management of each entity to be better focused.