The Central Bank of Nigeria (CBN) has approved a merchant banking licence for First Bank of Nigeria (FBN) Holdings Plc, through its subsidiary, the Kakawa Discount House Limited.
Mr Bello Maccido, FBN Holdings Group Chief Executive Officer, made the announcement at the company’s third Annual General Meeting (AGM) held in Lagos.
He said that the final approval was granted to the company by the CBN on May 19, adding that the Kakawa Discount House applied for the licence in December 2014.
Maccido said that the development would allow the company to use additional windows to sell investment banking products.
“To have a merchant banking licence will be beneficial to the shareholders in the medium to long-term,” Maccido said.
According to him, the licence would also leverage the company’s capacity to pay enhanced dividend to shareholders in the nearest future.
Maccido added that the company in 2014 increased its holding in the Kakawa Discount House to 100 per cent from 46 per cent.
The News Agency of Nigeria (NAN) reported that there are currently two licenced merchant banks in the country, namely FSDH Merchant Bank Ltd and Rand Merchant Bank.
He said that the company retained its profits because of the increased capital requirement of the CBN following the adoption of Basel 2 capital accord during the period under review.
Earlier, Mr Sunny Nwosu, National Coordinator, Independent Shareholders Association of Nigeria (ISAN), commended the company for saving for the rainy day and higher future dividends.
Nwosu enjoined the company to ensure the payment of an interim dividend to augment the 10k dividend declared and the bonus of one for 10.
He also commended the company’s management for avoiding contraventions and other penalties of regulators.