FBN Holdings Plc, the parent bank of First Bank Nig. Ltd responded to a query from the 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.

In one of the queries about why they classified the shareholdings of Mr Tunde Hassan-Odukale and his related parties into two parts of 4.16% and 1.20% respectively, the bank claimed that while Mr Tunde Hassan-Odukale held shares of 4.16% directly and indirectly, the 1.2% was “ascribed” to him (Mr Odukale) due to “his influence and having significant control” over the companies holding the shares.

In another question, the NGX inquired about the rationale behind including the 1.05% of Leadway Pensure PFA’s holdings as part of the investor’s 1.20%. FBNH responded that Mr Odukale has an indirect interest in Leadway Holdings Limited that holds 69% equity in Leadway Pensure PFA and as such exerts significant influence and control over Leadway Pensure. Consequently, the Company ascribed these shareholdings to him.

In listing the substantial shareholders of the bank, however, FBNH still listed Tunde Odukale as holding 0.07% direct and 5.29% indirect, thus, assigning as indirect, the shares owned by Leadway Pensure PFA which it claimed was “ascribed” to Mr Odukale. Mr Femi Otedola and his Calvados Global Services Ltd own a combined 5.07% as indicated by FBNH in a circular over the weekend.

What analysts are saying

Despite the claims made in the bank’s response to the query from the NGX, some analysts who spoke to Nairametrics on the condition of anonymity to avoid being accused of taking sides faulted some of the claims made in response to the query.

In one comment they 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 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.”

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.”

How this plays out will depend on what the regulators say in the coming days as the battle for who owns majority shares rages on. The Nigerian Security and Exchange Commission (SEC) is also likely to weigh in on this matter considering its significance for over a million shareholders of the bank.

Pencom Actions

The Pension Fund Commission (PENCOM) is yet to comment publicly on this matter since the news broke last week. However, sources in the industry inform Nairametrics that PENCOM had written to PFAs asking them to provide a statement of any interest they have in FBNH.
The source further explained that matters like this could also force PENCOM, the industry regulator to request that the PFA involved in a company with shareholder squabbles sell off their investment. However, the PFA could stall this if they are able to prove that doing so could lead to a loss of capital for pension fund contributors.