₦airaland Forum

Hanna is back o.

All 7 points are valid, the content of the leaked report is embarrassing!!!

An interesting read on GTB, Innoson, ownership claims and the sum of GTB potential liabilities , culled from the Nairametrics website.

Why Innoson can’t takeover GT Bank

The founder and Chairman of the Innoson Vehicle Manufacturing Limited (IVM), Mr. Innocent Chukwuma, has said he will takeover GT Bank. He made this remark in a chat with a selection of media and financial reporters at his home in Nnewi during the week.

Nairametrics attended the interview where the charismatic vehicle manufacturer responded to a cross-section of questions. However, one of the most remarkable statements made by Mr. Chukwuma was his envisaged (from his point of view) takeover of one of Nigeria’s largest banks, GT Bank.

According to him, he will fund the takeover of the bank from the money owed to him by GTB (which is now GT HoldCo) inclusive of accrued interest. Recall, Innoson has been in a legal battle with GTB in recent years over claims and counterclaims of loans between his company and the bank.

The statement, while off the cuff in response to the question he was asked, made a splash in the media and has also sparked concerns for shareholders of the bank. While we do not wish to prejudice the outcome of the court or assuage his claims (of which Mr Innocent has a right to make), it is important that we also address it from our perspective and also as part of our investor advocacy objective.

We will attempt to explain why is implausible to take over the bank on the basis of a judgement debt. But first, what he said.


Reporters: “For some years now, you have been having a running issue with Guaranty Trust Bank. What is the current situation right now?”
“You know I’m one of their best customers in the entire Southeast, especially when the former MD, Olutayo Aderinokun was alive. Because of me, they opened a branch in Nnewi. But after the demise of Aderinokun, the new MD took over. I do not know him but only met him for the first time last year. I’m not sure exactly why he is fighting me but I think it has to do with tribe.

But finally, I have proved him wrong in everything he is doing. I have defeated him in all the courts he went to. It remains for him to pay me what he owes me because he can’t just go to my account and take money anyhow, which I discovered, took him to court over and won. Up till this moment, he has not paid and we had gone up to the Supreme Court. Maybe he wants Nigeria to change its law because of him.

But the beauty of it all is that the money has been attracting the interest of 22% for 11 years now. I’m waiting for the interest to grow beyond their capacity, and then I would takeover the bank. I’m not disturbing them anymore, but I’m assuring all the customers of the bank that if I take over, I will still run it well. Let them not have any fear. I haven’t done any business that has failed. I will run it better than them. If the interest on my money is above the capacity of the bank, I’d have no choice but to take over the management,” – Innocent Chukuwma

Is this even possible?
Assuming Mr. Chukwuma’s claims that GTB does owe him money (that is if he does win at the Supreme court) and that the interest of 22% per annum does accumulate to such an astronomical proportion that it is more than the market capitalization or the net assets of GTB, it will still not mean that he takes over the bank that easily, if at all he could.

Here is why;

GTB factor

* Also to add that GTB (as with other public companies) does disclose the cases they have in court and the financial implications. As part of its disclosure, they also make provisions in their books for these cases in the event that they lose. Here is how GTB reported it in its 2020 audited report under “Claims and litigation”.

* “The Bank, in its ordinary course of business, is presently involved in 507 cases as a defendant (31 December 2019: 512) and 415 cases as a plaintiff (31 December 2019: 436). The total amount claimed in the 507 cases against the Bank is estimated at N440.83 Billion and $32.60 Million (31 December 2019: N462.09 Billion and $39.03 Million) while the total amount claimed in the 415 cases instituted by the Bank is N180.48 Billion (31 December 2019: N109.30 Billion). However, the solicitors of the Bank are of the view that the probable
liability which may arise from the cases pending against the Bank is not likely to exceed N190.20 Million (31 December 2019: N189.87 Million). This probable liability has been fully provided for by the Bank (please refer to Note 38)”

* This means GTB has court cases amounting to N440 billion against it but does not expect to incur more than N190 million liability assuming they lose the case.

* Assuming the claims as depicted by Innocent Chukwuma does crystallize, all GTB will need to do is enter a payment plan for the loan which will allow it to repay its profits over a protracted period.

* It could also call on its existing shareholders to embark on a rights issue or public offer or even seek external funding to raise money to repay the loan.

Other factors

* Judgment debts are also carried out with the interest of the public at the center of decision-making. GTB is a quoted company with over 327k shareholders of the bank. We don’t see how investments of thousands of people will be eroded on the back of a judgment debt.

* The Central Bank will as expected have the ultimate say who owns the bank. CBN approves ownership of banks especially for takeovers and it is unlikely that the apex bank will allow judgment debts to determine who owns a bank or not. Worst case, the CBN will bail out the bank and retain shareholdings rather than hand it over to Mr. Innoson if it doesn’t want to.

*There are also political connotations that can also affect how the judgment will be interpreted and treated assuming it goes in the favour of Innoson.

* Thus, we do not see how this is possible.

Finally, the claims by Mr. Innoson at least keeps him on the headlines and piles pressure on GT Holdco to put out a response in this ongoing court and media battle over a banking giant and vehicle manufacturing giant. It appears Mr. Chukwuma has the media vibes at the moment.

https://
ngxgroup .
com/exchange/data/company-profile/?symbol=DANGCEM&directory=companydirectory

ElixExo:
Nigerian expat boomers would eat this shit up, it's a safe and direct way to send USD from a domicilary account to someone in Nigeria without added costs.

How is this so? To load a domiciliary account from outside Nigeria, one has to follow the same existing but expensive means.

Except the e-Naira gets listed on major crypto exchanges, only then would it make remittance easy. I don't see that happening, e-Naira is not particularly appealing for obvious reasons.

Maybe, one way would be for the government to open exchange outlets within its embassies all round the world.

Labadi69:

Na Hero be my brand bro, just saying...

My message to you sinners: Stop collecting agunje, stop collecting bribes, follow due process, d process was made for a reason!

People who know that thing pass u made d process.

I no fit understand why someone who collects bribes or pays bribes to thwart the system should be complaining that the system no work. No be alabanko be that?

Labadi69:
Sho…una don turn this thread to essay competition. Who get time to read all this senseless yamayama epistles? Abi all of una dey ment?

Funny enough I don't soak sote I no dey see road well, but me still agree with you, d epistles plenty. I no fit read all that shit not now, not even when I am sober.

jedisco:
So far, it just looks to be another payment gateway which it doesn't excell at.

What I don't like is having to input the wallet login details into a third-party banking app to top up... That in itself is a security flaw waiting to be breached.

It's still early days but if the current wallet is their vision of what a cbdc should be, then the CBN is more deluded than I thought. They should have just kept calm and let other nations issue theirs so they copy...

I created the wallet account, never loaded it. It looks like more work need to be done.

On a serious note, these headlines though:

"e-Naira offers cheaper, fast remittance option, says CBN" - Punch Newspaper

"eNaira would boost diaspora remittance flows – CBN" - Nairametrics

And a few others. Now, how is this so? I am not saying e-Naira has no potential, but how is it going to boost remittances?

EarlyCareer:
Great perspective.

Again, as much as I agree with you, jedisco, the focus is on the USA. Your comment, while being true, is a blanket statement.

TL;DR

LordAdam16:
Your last sentence in bold is all you really had to share. The USA is a great place, some developed countries are better. AND THE USA AND THESE OTHER DEVELOPED COUNTRIES ARE COLLECTIVELY AND INDIVIDUALLY BETTER THAN NIGERIA.

-Lord

Too long; didn't read

Labadi69:
All these people still writing very long senseless epistles make una take time o before yamayama nack una bald head

Feels like an essay competition.

meobizy:
Raised By Wolves. 5/10.

Episodes 1 - 5 held so much promise. From there it’s a shit fest till the show ends. The characters act stupid and I don’t know why this is a running theme in modern film and TV. The androids are meant to act on logic and yet are the most emotional characters in the whole series save for their more emotional offspring. It does make sense why Mother acts emotional, but then father gets in on the act. I enjoyed how when he does he’s quick to default back to logic.

Travis Fimmel does a great act of a man slowly consumed by insanity. His and the androids’ plot armour is otherworldly, just when you think any would die, fate saves them. It got me so annoyed that I thought of quitting the series early. I’m completely done after season 1. That’s the last time Ridley Scott’s children would trick me into watching garbage using his reputable name. Episode 10 was what-the-Bleep-did-I-just-watch. I’ve warned you beforehand.

Sci-Fi fans should watch this. I’m not so keen on the genre any more. People highly rated Netflix’s Altered Carbon and I hate both the show and Kinnaman’s tough guy acting.

Raised by wolves wasn't that bad though, I really liked the theme song.

Androids act based on their programming. In several show and movies I have watched, the higher the display of emotions the more advanced they were. The less advanced ones were the ones acting all logical.

Lazyyouth4u:
Xiaoli please sell your Uber Pencil light Camry and buy this man 10 bottles of Cristal. Very valid points!

Every human endeavour has 2 parts: skill and luck. Some activities are more skill than luck, like driving, it is repeatable with same results most of d time.
While some other activities are more luck than skill, like investing, you can do everything right and yet end up with poor results.

It is always better to judge d decision or process rather than the results.

jedisco:
For comparison, the US stock market has historically beat inflation and so it always made more sense for their citizens to invest in it than keep money in the bank.

The statement above is not completely correct.

The USA stock market unlike NSE has over 20,000 stocks (NSE has less than 200 listed stocks ). In there u can find all sorts, from badly performing to well performing stocks.

The common advice is to invest in stock indexes, like d ones that mirror S&P 500, NASDAC, dow jones etc. Trading or investing in individual stocks is risky same as in NSE, and u are most likely to loose ur money, except you have skills and knowledge.

People talking about the USA stock market don't know that it is not a place where you easily make money. NSE has its problems but it isn't that bad, they key is in d stock selection process as well as timing.

Only a few seasoned analysts or edge funds managers make returns that beat the S&P 500, the yardstick usually used to measure performance. Only a few have alpha.

Note that the S&P 500 has a CAR, compounded annual return, of less than 9% over the last 40 years plus.

It is not all that rosy in the Big USA either, as some people make it out to be. I often read about how it's better to invest in an Index than buying individual stocks. Why?

AngelicBeing:
Hian, if you use that derogatory word called Yamayama on this thread again , you will be flogged 60,000 lashes of koboko laden with chilly pepper and your nairaland account will be banned for 25 years

It seems that the people in that picture were only interested in delivering pain to a carefully selected spot - his bumbum. See how they padded his weewee and spine very well. Very pleasant fellows.

Labadi69:
Guy you like to engage in yamayama argument. That bank has got serious issues and if not for CBN’s intervention was going down. If you know, you know. Leave matter for Matthias before yamayama nack that your bald head this early momo

U no well!!!

Wrong thread

Seniorwriter:
The people we have as leaders/Authority office holders think too highly of themselves and have a very stereotype IQ.?

NIN linking to phone numbers should be a continuous process and not one with ultimatum dates!

@SENIORWRITER

Can you get a new sim to work without first linking it with NIN, currently? D deadline was for old subscribers who refused to link there NIN or get d NIN. U are obviously ret@rded.

Seniorwriter:
[s]The people we have as leaders/Authority office holders think too highly of themselves and have a very stereotype IQ.?

NIN linking to phone numbers should be a continuous process and not one with ultimatum dates!
BTW what are they doing to have a reliable database[/s]...i know of peeps that did their NIN yet it can't be recognized by their sim providers! yet these mofos as terrorists sympathizer pantami's urchins called NCC keeps dishing out spurious threats rather than effectively engage and sensitize the pubic on the positives of linking ones NIN to SIM(s) SMH.




We need young visionary leaders in Nigeria!

@SENIORWRITER

Rubbish.

investpy.readthedocs. io/_api/crypto.html

XiaoLi:
Next na to buy that land wey you dey use as a hideout

Big boy, for this Buharied weather, he no easy o.

yMcy56:
Bros, don't come and go and be disturbing yourself upandan about what I said o.

Mcy56, person no fit following talk argue again.

yMcy56:
Mansard
If your broker is yet to adjust your portfolio with the right re-constructed quantities, don't go and do magomago by selling ooo......You'll still vomit it.

Don't do Charles Chaplin for NSE or your broker.....your name, quantity purchased and date dey on record.
Just be calm and give it enough time. Mansard should come around.

BTW, it seems everyone on this thread is now on holiday.
It's well.

How do you do magomago? I thought NSE has one trading floor where all brokers plug in.