Business
UBA cancels N20bn staff scheme shares
United Bank for Africa (UBA) Plc on Wednesday cancelled 2.08 billion ordinary shares valued at nearly N20 billion that belonged to the bank’s Staff Share Investment Trust Scheme (SSIT).
The share cancellation is part of the closure process for the bank’s SSIT, ending the practice of allocating shares to employees. Shareholders of the bank had at the annual general meeting in 2016 approved the cancellation of the shares under the SSIT in line with the board’s decision to close the SSIT.
The total outstanding ordinary shares of UBA which stood at 36.28 billion ordinary shares before the cancellation reduced to 34.199 billion ordinary shares after the cancellation.
Market analysts had earlier raised concerns that the bank has not fully disclosed details about the SSIT, alleging that the SSIT was used as a front to warehouse shares and illegally inflate subscription level during the heyday of the public offer in 2005 to 2008.
Read also: NSE ROUND-UP! Equities in tight trading amidst marginal recovery
Analysts said the directors of the bank should disclose the whereabouts of the dividends paid over the years on the cancelled shares and the reason for the warehousing of the shares.
The management of the bank however stated that the cancellation would lead to value accretion to shareholders, as the enterprise value of the group remains unchanged.
“The unit holding of all shareholders remains the same, whilst their respective percentage holding in UBA Plc will increase,” the bank stated.
According to the bank, the cancellation of SSIT shares has no impact on its liquidity and capital adequacy ratios as it continues to maintain strong liquidity and capital adequacy ratios, which stood at 41 per cent and 19.4 per cent respectively, as at March 31, 2017.
RipplesNigeria… without borders, without fears
Click here to join the Ripples Nigeria WhatsApp group for latest updates.
Join the conversation
Support Ripples Nigeria, hold up solutions journalism
Balanced, fearless journalism driven by data comes at huge financial costs.
As a media platform, we hold leadership accountable and will not trade the right to press freedom and free speech for a piece of cake.
If you like what we do, and are ready to uphold solutions journalism, kindly donate to the Ripples Nigeria cause.
Your support would help to ensure that citizens and institutions continue to have free access to credible and reliable information for societal development.
INVESTIGATION: In Kwara, multimillion-naira milk processing plant is abandoned, converted to a chicken outlet
After the government spent millions of naira to establish a milk processing plant in Kwara State that would provided jobs...
SPECIAL REPORT: For Sokoto communities, promise of healthcare is akin to death sentence
In this story, ABDULRASHEED HAMMAD delves into the dire realities of Primary Health Care services in Sokoto State, shedding light...
ICYMI…SPECIAL REPORT: NNPCL hides behind PIA to frustrate disclosure, accountability
Nigeria’s major oil company, Nigerian National Petroleum Corporation Limited (NNPCL), in what appears to be a common practice of disregard...
INVESTIGATION: Multi-million naira Ekiti resort center remains uncompleted a decade after
The multimillion-naira project, expected to comprise recreational buildings, now consists of cassava farmland, a bush used for excretion, and a...
SPECIAL REPORT: Torturous experiences of students with disabilities in Oyo tertiary institutions
For students with disabilities in Oyo state-owned tertiary institutions, learning is a torturous and distressing experience, considering the building structures...