The Central Bank of Nigeria has granted approval in principle for Zenith Bank Plc to transition into a non-operating financial holding company structure.
This was contained in a notice to the Nigerian Exchange Limited (NGX) and obtained by Nairametrics.
A holding company is a parent business entity that holds the controlling stock or membership interests in its holding companies.
Jim Ovia as the chairman of new Holdco:Â According to the statement signed by Company Secretary/General Counsel Micheal Osilama Out, the CBN also approved Mr Jim Ovia as the chairman of Zenith Holdco Plc. In the meantime, Ovia will continue to function as the chairman of Zenith Bank Plc until the commencement of Zenith Holdco Plc.
The statement noted that further details in respect of development will be communicated to the market in due course.
With the approval, Zenith Bank will join other big banks like FBN Holdings, GTCO, and Access Holdings, among others as a financial holding company.
In case you missed it: The move by Zenith Bank Plc is coming just weeks after the CBN issued a circular notifying commercial banks of the new directive that will henceforth determine stipulate that the tenure of their Executive Directors (EDs), Deputy Managing Directors (DMDs) and Managing Directors (MDs).Â
Since the CBN disclosed the new tenure guideline, some top bank executives have had to resign. Just earlier this week, Zenith Bank’s Deputy Managing Director Dr Adaora Umeoji “retired”.Â
Nairametrics reported that Umeoji resigned following the new CBN regulatory guidelines that put a timeline on the cumulative number of years senior bank officers could occupy executive board positions.
There have been arguments as to why the new CBN directive should not affect banks that have holdco structures, seeing as holdcos are not financial insitutions themselves but “constellations of different financial and technology-related businesses”, as Proshare recently described it.Â
