Analysts Knock First Bank Over Poor Response To NGX’s Query 

Battle of Wit Rages On Between Odukale and Otedola
The Nigerian Security and Exchange Commission (SEC) is set to weigh in as the battle for who owns majority shares in FBN Holdings Plc, the parent bank of First Bank Nig. Ltd rages on.
SEC, is set to weigh in to the  matter considering its significance for over a million shareholders of the bank who have been confused over who controls tge majority shares of the company.
However, FBN Holdings is presently embroiled in another controversy over its response to Nigerian Exchange Ltd via a letter dated October 26, 2021.
In the letter titled “RE: Update on the Substantial Shareholders of FBN Holdings Plc,” the bank responded to 6 queries bothering on the claim that one of its directors Mr Tunde Hassan-Odukale owned 5.36% shares in FBN Holdings Plc.
But, despite the claims made in the bank’s response to the query from the NGX, financial analysts have faulted some of the claims made in response to the query.
According to an investment banker, Kolade Ajasa, he explained that investments by Pension Funds Administrators in quoted companies are usually done on behalf of the Custodians.
 Typically, the funds are classified in the name of the Pension Fund Custodians and that of the PFA.
Another analyst who craved anonymity, added that the operators of the PFAs are not directors of companies that they invest in to avoid conflict of interest. For example, a PFA will not invest in a company where one of its directors or related parties has shares.
According to Section 6 6.1 iii under the Regulation on Investment of Pension Fund Asset of February 2019, “The PFA or any of its agents are prohibited from investing Pension Fund Assets in the shares or any other securities, issued through public or private placement arrangements, by the following Related party/person of any shareholder of the PFA.”
 This is perhaps the reasons for not assigning shares owned by the PFA as “indirect shareholdings” of Mr Odukale.
In addition, Section 6.3 of the same guideline also “prohibits PFAs from selling their assets to related party/person of any shareholder of the PFA,” suggesting that shares of the Pension Fund cannot be sold to a related party of Leadway Group.
The letter from FBNH to the Nigerian Stock Exchange may also provide a legal rationale for ascribing the shares as “indirect interest” in FBNH.
According to their response, Section 88 (1) CAMA 2020 defined a “person with significant control” as any person: otherwise having the right to exercise or actually exercising significant influence or control over a company or limited liability partnership; or having the right to exercise, or actually exercising significant influence or control over the activities of a trust or firm whether or not it is a legal entity but would itself satisfy any of the first four conditions if it were an individual.”

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