A coalition of minority retail shareholders in FBN Holdings Plc yesterday called on regulatory authorities to wade into alleged attempts by certain individuals to undermine the oldest financial services group in the country.
Shareholders who staged a solidarity protest at the Marina, Lagos head office of FBN Holdings, said several petitions have been submitted to the regulatory bodies concerning clandestine plots to frustrate the board and management of the group and make the first-tier bank vulnerable.
According to the shareholders, there was ample evidence before the Central Bank of Nigeria (CBN), Securities and Exchange Commission (SEC) and other regulatory bodies to take action.
They alleged that there were moves to frustrate the forthcoming annual general meeting (AGM) scheduled for next week amid a plan to expand the capital base of the banking group.
The inability of FBN Holdings to hold AGM will expose the group to several defaults and sanctions for breach of corporate governance practices and extant rules at the capital market.
The group, unlike other competitors that are taking proactive measures to beef up their capital base, will also not be able to increase its capital, the key measurement of a financial services group.
At the forthcoming AGM, apart from the ordinary businesses of consideration and approval of annual financial accounts and reports, dividend payment and audit committee, among others, FBN Holdings also plans to seek shareholders’ approval to increase its share capital, raise new equity funds and appoint new directors.
Chairman of Trusted Shareholders Association of Nigeria, Alhaji Mukhtar Mukhtar, who spoke on behalf of other minority shareholders, said they were calling on the regulators to take cognisance of the roles and institutional importance of FBN Holdings and act to protect the group from aggressive moves by some individuals to undermine the group.
He said an AGM is a statutory meeting and an attempt by some individuals to stop the group’s general meeting amounts to direct sabotage, especially when such a meeting has been duly convened in line with requisite corporate governance rules.
He pointed out that FBN Holdings has an important, systemic function in the economy of Nigeria as one of the few banks that stabilise most of the monetary and fiscal policy and banking practices.
Mukhtar urged the regulators to allow the financial institution to grow by enforcing best practices and by resolving the looming crises.
“We are here to register our displeasure, our discontent, our disapproval and rejection of the attempt by some shareholders to prevent the AGM of FBN Holdings from holding and thereby preventing some resolutions from being passed. We want the AGM to proceed and the resolutions passed.
It is not right that some people who have benefited from the political economy of this country are the ones holding this institution to ransom.
“So I think those people that have gone to court in order to stop the AGM from holding know that it is illegal. AGMs are statutory meetings, and nobody can stop them.
“We have instances from the past whereby some aggrieved individuals or parties or shareholders approached the court in order to stop the conduct of the AGM, but the judges refused.
“They are trying to prevent the bank from holding AGM and considering some resolutions, which is to raise more capital for the banking business. You can agree with me that the banking business is about capital. If there is no capital, business will collapse. And for the banking industry, capital is very, very important,” Muktar said.
He said the regulators have the mandate to protect institutions from abuses.
“The regulators should come in. They cannot continue in their complacent behaviour in the face of abuse. They must ignite certain regulatory powers. They can suspend the shares of those people who attempt to hold this bank to ransom.
“We cannot allow this bank to die therefore, the regulatory authorities must act now because they just cannot be quiet,” Muktar said.
A petitioner, Olusegun Samuel Onagoruwa, had in a letter addressed to the board of FBN Holdings, said the court had given an order to stop the AGM.
Take notice that unless you obey the directives in the judicial order contained in the order made on the 15th July 2022 by the Federal High Court, Lagos, by refraining from proceeding with the 11th Annual General Meeting of FBN Holdings Limited proposed for 15th August 2023 from seeking approval to issue or raise share capital in any manner whatsoever, from appointing or confirming the appointment of new directors, or in any other manner taking any step towards implementing, actualising enforcing resolution of the 10th Annual General Meeting of FBN Holdings Plc held on 20th June 2022 or in any other manner overreaching, disobeying or undermining the said order of court, you will be guilty of contempt of court and you will be liable to be committed to prison and to there imprisoned,” the statement read.”
FBN Holdings has been embroiled in a takeover struggle in the recent period. A special purpose vehicle, Barbican Capital, registered in the name of Otudeko’s children, had announced the acquisition of a 13.3 per cent equity stake, to become the single largest individual shareholder in the banking group.
However, the CBN, which is required to clear such a major acquisition, has not issued any public statement on the acceptance of the acquisition.
Other shareholders had earlier decried what they described as aggressive takeover bids by Otudeko, whose long reign as a director and chairman of the group was ended by regulatory intervention.
Shareholders said the performance of the group has shown stability and remarkable improvements, decrying attempts to instigate new crises in the group.