Agbaje: Listing on LSE Has Given GTCO Robust Access to Global Capital Space

Early last month, Guaranty Trust Holding Company Plc, the parent company of Nigeria’s biggest lender by market value, GTBank, announced plans to list $105 million  (N157 billion) on the London Stock Exchange  after cancellation of its Global Depository Receipts.

Prior to now, the financial institution had maintained a presence on the LSE through its GDRs, with each GDR representing 50 ordinary shares.  The move to list on LSE followed the announcement by the Central Bank of Nigeria (CBN) that international banks are required to have N500 billion paid-up capital requirement by March 2026.

On July 9, 2025, GTCO’s 2.29 billion ordinary shares were officially admitted to trading on the main market board of the LSE via FCA’s equity share segment, which made the lender the first Nigerian bank with structure of listing on LSE, thus joining companies like Seplat Energy Plc and Airtel Africa Plc, and setting a trailblazsng example on global capital access for Nigerian financial institutions.

Speaking in a post-listing media chat in London, GTCO’s CEO, Mr Segun Agbaje, explained that the transition from GDRs to LSE’s share listing is more than just optics; it is a strategic recalibration aimed at unlocking access to the global capital space and attracting long-term institutional investors. Excerpts!

What does the GDR delisting mean to Guaranty Trust Holding Company Plc (GTCO), and what does it mean to international investors?

If you look at dual listing, obviously you will delist the Global Depository Receipts (GDRs) which means that GDR is now listed on the secondary market like the new shares. It means that anytime you want to raise capital, you can come back to the LSE. So, you have created another platform for you to raise capital whether it’s for your business in Nigeria or for a business group. That’s why I call it the best of both worlds where you have Nigerian Exchange Limited (NGX) and now you have LSE.

What motivated Guaranty Trust Holding Company Plc to embrace this route?

We have to unlock Nigeria and unlock Africa. In my opinion, it was time to test whether the macro economic story of Nigeria should change, or whether you could go out and raise money in the international market. And really, that’s it, and it’s always nice to have options. So, if you ever need capital, if you want to raise it outside of Nigeria, you have the choice. Do you want to raise it in Nigeria? So if you have growth plans, you’ve given yourself more options.

What is your response to GTCO’s current valuation on the NGX?

I think we still have a long way to go in terms of finding the right valuations, and that if you look at the valuations of most companies in Nigeria, they’re trading below book or just above book. So for discerning people, Nigeria is actually a pretty cheap place to shop at the moment in terms of what you can buy. You have companies that are doing over 30 percent ROE trading a book or below book. So, valuation is definitely undervalued currently.

Can you offer us an insight on the strategy behind raising capital from the local and international markets as most banks were raising capital from the local market?

The structure of how we raise capital in Nigeria is quite elongated. One, we realised that you couldn’t bring in the internationals in any great numbers into the local structure. But we are a Nigerian institution with over 50 per cent retail base. So, we didn’t want to dilute that retail base and not give them a chance to do the capital raise. We decided that we were going to give our first phase to that retail base and raise as much capital as we could from them, and later we would raise internationally. We did the best we could, and we raised N209 billion.

It gave us a delta of about N150 billion to get to N500 billion. And so we started the journey, and immediately we finished that transaction, we began to do this one. If you feel your stock is overvalued, then you want to sell more. But if you feel your stock is undervalued, you will have to raise capital and you will want to sell less.

The GTCO Group now has various classes of shareholders! What sort of return expectation do you anticipate?

A lot of our Nigerian retail shareholders judge us more on dividend pay outs. So, we’re now going to work on two parameters. I think that every Nigerian company should try and pay at least 15 per cent dividend yield when you look at the rate of inflation. So, for the GTCO Group,we’re going to keep that as a parameter. I think when you look at some of the volatility in the macros, you’ve got to do at least a 25-per cent ROE at the minimum. For us, by doing this deal now, we’re going to be managing, hopefully, a dividend yield of about 15 percent ROE expectations for retail Nigerian investors and a 25 percent minimum for foreign institutions.

With GTCO’s listing on the LSE, any potential acquisition outside Nigeria?

You know we are very conservative. Honestly, diversification is happening without a lot of noise. Nigeria today is really only about 67 percent of our profit and West Africa is 27 percent. We’re going to try and push East Africa from the 1.5 percent it holds and the UK is 1.8 percent.  

We will go to Senegal. I mean, that’s our first point of call. So outside Nigeria will become more important for sure. And our non-banking subsidiaries are up around 1.4 -1.5 percent and they’re barely three years old. So, we will gain some traction there.

So, you are right. But more than anything else, part of what we would do with the capital outside of Nigeria is increase the branch network in those countries, because we are clearly on the ground there. And by doing that, we’ll deepen the business. I’m not so sure you need to be 30 or 35 countries. I think you need to be in Africa today, maybe even about 15 countries and be dominant. There’s no point going into 30 countries and you’re a small player everywhere. So, what you will see us do with this capital is to come up with a strategy to become more dominant and become top five in every country. That will be our aspiration.

Any plans to be in the USA and Asia?

You know, we’re still trying to digest the UK probably contributing 1.8 percent to our profit.   I think ultimately, probably the Far East will be a place to look at more than the US. It is more attractive to us than the US market, especially for trade.

How challenging was it, and what were the takeaways for GTCO in meeting the governance and regulatory requirements of the LSE?

It’s very challenging. I mean, I can’t tell you. But with ths exchange you have to meet strict criterial. You have to meet the FCA as the financial regulator of LSE. I think, honestly, the takeaway is that you have to learn how to play by the rules because you’ll be surprised how much pops up. The other takeaway, which I pray we understand in Nigeria, is that we’ve got to use media a bit more responsibly, because when you do due diligence on a company, everything that has been said about that company or the individual pop up and you’ll have to defend them, but people don’t see that. You will have to debunk, confirm and you will have to explain.  It tells you that you can scale if you want to live your life well and you can value it.

What options do you recommend on the banking sector forbearance policy of the CBN?

First of all, I don’t think forbearance or the exit should have come as a surprise to banks. We all had a letter that said it will end in 2023. Therefore, we should have exited by the end of 2024.  So, whatever the regulator has chosen to do should not have come as a surprise. We were given more than enough time to adhere and that is really my position on forbearance.

Lastly, lets talk about the CRR policy of the CBN, how is it impacting banks to scale up profitability?

I think CRR is a result of a liquidity overhang that was inherited by this government and CBN. You will have to find a methodical way of getting rid of that liquidity. My belief is that as the CBN sees normalised liquidity, they will reduce CRR over time. But I don’t think it’s realistic to expect them to just reduce CRR in the midst of what is in the large liquidity overhang, which was inherited.

QUOTES

“It’s very challenging. I mean, I can’t tell you. But with this exchange you have to meet strict criterial. You have to meet the FCA as the financial regulator of LSE. I think, honestly, the takeaway is that you have to learn how to play by the rules because you’ll be surprised how much pops up. The other takeaway, which I pray we understand in Nigeria, is that we’ve got to use media a bit more responsibly, because when you do due diligence on a company, everything that has been said about that company or the individual pop up and you’ll have to defend them, but people don’t see that. You will have to debunk, confirm and you will have to explain.  It tells you that you can scale if you want to live your life well and you can value it. “

“The structure of how we raise capital in Nigeria is quite elongated. One, we realised that you couldn’t bring in the internationals in any great numbers into the local structure. But we are a Nigerian institution with over 50 per cent retail base. So, we didn’t want to dilute that retail base and not give them a chance to do the capital raise. We decided that we were going to give our first phase to that retail base and raise as much capital as we could from them, and later we would raise internationally. We did the best we could, and we raised N209 billion.”