Nairametrics File copy
Zenith Bank, a few days ago, released an impressive result for the 12 months ended December 2017. While the bank’s financials are solid, Zenith could do much more better with disclosures and insider transactions.
Indirect holding vehicles not stated
Zenith’s Chairman, Group Managing Director and Deputy Managing Director all have indirect holdings in the bank. The Chairman, Jim Ovia, has an indirect holding of 1.5 billion shares, GMD Peter Amangbo, an indirect holding of 2.3 million shares, and DMD, Adaora Umeoji, has an indirect holding of 1.7 million shares.
The indirect vehicles used are however not stated. While such a requirement is not compulsory, board members in other banks and quoted firms as a whole usually state them.
Even more puzzling, however, is what seems like an oversight. The bank’s financial statements for 2017 show a comparison of holdings for directors with the prior years, both direct and indirect.
The bank’s 2016 financial statements however have no record of indirect holdings.
So where did the indirect holdings referred to in the 2017 financial statement pop up from?
Unclear related party transactions
Zenith in October 2017, signed an agreement with Oviation limited for the lease of a Gulfstream jet over a tenure of ten years. The bank is expected to make an annual payment of N2.76 billion to Oviation limited. Oviation limited has two common directors with Zenith Bank. The directors involved are however not disclosed.
While the bank states that the transaction was conducted at arm’s length, it made no mention of several quotes being sought from other parties before picking Oviation Limited. The statement does not specify if the jet is a brand new one or used, as well as the exact model.
“Oviation Limited”. Isn’t it obvious Mr Ovia is the principal ?
On face value, yes. In reality the company should specify. Zenith also states that two directors of the bank are also on OViation limited. The second director is neither mentioned nor can be inferred.