The Nigerian Exchange Limited has suspended trading on the shares of Guaranty Trust Bank Plc. The suspension follows the bank’s plans to operate as a financial holding company (HoldCo) with the name ‘Guaranty Trust Holding Company Plc ‘ from 2021. As a holding company, the bank will be a subsidiary of the new structure and will lead to the delisting of the GTBank from the bourse and the listing of GT Holdco on the bourse.
The suspension which took effect Friday was disclosed by the Exchange.
“The suspension is necessary to prevent trading in the shares of the Bank in preparation for the eventual delisting of Guaranty Trust Bank Plc from the Daily Official List of the Nigerian Exchange Limited (NGX) and listing of the Holding Company, Guaranty Trust Holding Company Plc on NGX,” said NGX.
The company had on November 6 last year obtained an authorisation from a Federal High Court sitting in Lagos. Shareholders met last year to discuss on the transfer of the 29,431,179,224 ordinary shares of 50 Kobo each in the issued and paid-up share capital of the bank held by them to GT Holding Company Plc. This was in exchange for the allotment of 29,431,179,224 ordinary shares of 50 Kobo each in the share capital of the holding Company to the shareholders in the same proportion to their shareholding in the bank. Segun Agbaje, Managing Director/CEO, GTBank Plc, believes that the HoldCo would perform better. The Central Bank of Nigeria had directed the separation of commercial banking business from other financial services businesses by banks.
Meanwhile Following two consecutive weeks of gains, the bullish run on the domestic bourse was halted as sell-offs in market bellwethers dragged performance. Consequently, the benchmark index slid 1.3% w/w to settle at 38,648.91 points, YTD loss worsened to -4.0% while market capitalisation declined ₦266.0bn to ₦20.1tn. The bearish performance was largely due to losses in AIRTELAF (-10.0%), STANBIC (-4.9%), and GUARANTY (-1.2%). Activity level strengthened as average volume and value traded rose 15.9% and 1.2% w/w respectively to 220.6m units and ₦2.5bn. The top traded stocks by volume were ZENITH (96.9m units), STERLING (86.9m), and ACCESS (82.7m) while ZENITH (₦2.3bn), GUARANTY (₦954.6m) and SEPLAT (₦809.5m) were the top traded stocks by value.
Sector Performance was bullish as 4 of 6 indices under our coverage closed in the green. The Banking index advanced the most, up 1.1% w/w following price appreciation in ACCESS (+4.3%) and ZENITH (+2.8%). The Oil & Gas index followed, up 1.0% w/w on the back of gains in SEPLAT (+1.4%) and OANDO (+0.7%) while the Insurance index climbed 0.8% w/w due to rallies in LASACO (+10.3%), NEM (+3.9%) and WAPIC (+3.6%). Similarly, the Consumer Goods index rose 0.2% w/w as investors took a position in CHAMPION (+10.0%) and HONYFLOUR (+6.1%). Conversely, losses in AIRTELAF (-10.0%), CHAMS (-4.8%), and WAPCO (-0.9%) dragged the AFR-ICT and Industrial Goods indices lower by 4.1% and 0.1% w/w.
Investor sentiment, as measured by market breadth, improved to 1.7x (against 1.2x recorded last week) as 38 stocks advanced against 22 that declined. The best performing stocks were BERGER (+14.9%), LASACO (+10.3%) and CHAMPION (+10.0%) while UACN (-11.0%), AIRTELAF (-10.0%) and ABBEYBDS (-9.5%) were the worst performers. In the coming week, we expect to see some bargain hunting in early trades as investors seek to take position in bellwethers that have fallen to attractive entry prices. However, we believe the negative performance will be sustained in the absence of a positive catalyst.