GTBANK OFFLOADS SUBSIDIARIES

Guaranty Trust Bank has announced a decision to divest its non-banking subsidiaries in compliance with new regulation by the Central Bank of Nigeria abolishing universal banking. The subsidiaries are Guaranty Trust Assurance,  GT Asset Management Limited, GT Homes and GT Registrars, which were permitted under the universal banking policy introduced in 2000 by then CBN governor Joseph Sanusi. However the new governor, Lamido Sanusi (no relation), has reversed that policy and asked banks to concentrate on core banking, while they may set up holding companies to handle their investments in other financial subsidiaries. The new policy takes effect next month after which no fresh universal licences will be issued.  Explaining the reason for the new directive, Sanusi said that under universal banking the banks concentrated on trading to the detriment of core banking.  He said the new banking model would protect commercial banking activities from pressures from non-commercial banking operations, to allow the banks concentrate on their traditional roles. 

The CBN under the new model is introducing three licencing types based on geographical coverage from next year. These are commercial banking licence for regional, national or  international banking, with minimum paid up capital of N10 billion, N25 billion and N50 billion respectively. There will also be specialised banking licence for those micro-finance, mortgage and non-interest banks which may be regional or national. The third license is for Investment Banking - and extended to development banking.