Guaranty Trust Bank plc has over the years, acquired an enviable reputation built on a solid foundation of integrity, professionalism, value adding service delivery and excellent corporate governance. As a publicly quoted company with a highly diversified ownership structure, the Bank is committed to improving shareholder value through transparent best business practices.
In addition to the principles of the "Code of Corporate Governance for Banks in Nigeria Post Consolidation" issued by the Central Bank of Nigeria (CBN), and the Securities and Exchange Commission's "Code of Best Practices", the Bank benchmarks itself against international best practices. The Code of Corporate Governance of Guaranty Trust Bank plc (revised in January, 2011), provides the basis for promoting the highest standards of corporate governance in the Bank.
The Bank is governed by a framework that facilitates checks and balances and ensures that appropriate controls are put in place. The Corporate Governance rubrics of the Bank are designed to ensure accountability of the Board and Management to stakeholders.
The business of the Bank is driven by the Board of Directors which exercises its oversight function through its various Committees, namely; the Board Risk Management Committee, Board Credit Committee and the Audit Committee of the Bank.
Through these Committees, interactive dialogue is employed to set broad policy guidelines, and to ensure the proper management and direction of the Bank on a regular basis. In addition to the Board Committees, there are three Management Committees; Assets and Liability Committee, Management Credit Committee and Criticised Assets Committee to ensure effective and good Corporate Governance at the Management level. These are the Committees which form the bedrock for the long-term professional management of the business of the Bank.
Board Of Directors
The Board of Guaranty Trust Bank plc is comprised of Fourteen (14) members, including the Chairman, Managing Director, Deputy Managing Director, Four (4) Executive Directors and Seven (7) Non-Executive Directors. The roles of the Chairman and Chief Executive are separate. The Bank's Board is made up of a crop of seasoned professionals who have excelled in their various fields cutting across banking, oil and gas and law.
The Non-Executive Directors have the requisite integrity, skills and experience to bring independent judgment to bear on Board deliberations and discussions. The Board is responsible to shareholders for creating and delivering sustainable shareholders value through the management of the Bank's business. The Board is accountable to shareholders and is responsible for the management of the Bank's relationships with its various stakeholders. The Board accordingly determines the strategic objectives and policies of the Bank to deliver long-term value, providing overall strategic direction within a framework of rewards, incentives and controls.
Board Risk Management Committee
This Committee is tasked with the responsibility of setting and reviewing the Bank's risk policies. Its major responsibilities include setting policies on the Bank's risk profile and limits, determining the adequacy and completeness of the Bank's risk detection and measurement systems, assessing the adequacy of the mitigants to the risks, reviewing and approving contingency plans for specific risks and ensuring that all departments in the Bank are fully aware of the risks involved in their functions.
This Committee is also charged with the quarterly review of the Bank's central liability report and summary of criticized loans with the concurrent power of recommending adequacy of the reserves for loan losses and possible charge-offs.
Membership of the Committee is made up of three Non-executive directors and three Executive Directors.
Board Credit Committee
This Committee is responsible for approval of credit facilities in the Bank. It reviews credits granted by the Bank and approves specific loans above the Management Credit Committee's authority limit as may be defined from time to time by the Board of Directors. The Committee is also responsible for ensuring that the Bank's internal control procedures in the area of risk assets remain high to safeguard the quality of the Bank's risk assets.
In view of the volume of transactions that require Board Credit Committee's approvals and the need to approve credits expeditiously, credits are circulated amongst the members for consideration and approval between Board Credit Committee meetings in line with a defined procedure that ensures that all members of the Committee are furnished with full information on such credits.
All credits considered as "Large exposures" (as defined by the Board of Directors from time to time) are considered and approved by the Board Credit Committee at a special meeting convened for that purpose. The Board Credit Committee met on three occasions during the 2007/2008 financial year.
These are Committees comprising of senior management of the Bank. The Committees are also risk driven and are basically set up to identify, analyze, synthesize and make recommendations on risks arising from the day to day activities of the Bank. They also ensure that risk limits as contained in the board and regulatory policies are complied with at all times. They provide inputs for the respective Board Committees and also ensure that recommendations of the Board Committees are effectively and efficiently implemented.
They meet as frequently as the risk issues occur to immediately take actions and decisions within the confines of their powers. The main Management Committees in the Bank are: Assets and Liability Committee, Management Credit Committee, and Criticized Assets Committee.
Assets and Liability Committee
This Committee is responsible for the management of a variety of risks arising from the Bank's business including, market and liquidity risk management, loan to deposit ratio analysis, cost of funds analysis, establishing guidelines for pricing on deposit and credit facilities, exchange rate risks analysis, balance sheet structuring, regulatory considerations and monitoring of the status of implemented assets and liability strategies.
Composition of the Committee is made up of senior management staff of the Bank, including the Executive Directors of the Bank, with the Assets and Liability Management Unit acting as the secretariat.
Management Credit Committee (MCC)
This is the Committee responsible for ensuring that the Bank complies fully with the Credit Policy Guide as laid down by the Board of Directors. The Committee also provides inputs for the Board Credit Committee. This Committee is empowered to approve credit facilities to individual obligors not exceeding in aggregate a sum to be determined by the Board from time to time.
The Committee reviews and approves extensions of credit, including single obligor commitments that exceed an amount to be determined by the Board. The Committee meets at least once a week or once a fortnight depending on the number of credit applications to be considered.
The secretary of the Committee is the Head of Credit Administration, while senior management staff of the Bank make up its membership, including the Managing Director, Deputy Managing Director and other Executive Directors.
Criticized Assets Committee (CAC)
This Committee is responsible for the assessment of the risk asset portfolio of the Bank. It highlights the status of the Bank's assets in line with the internal and external regulatory framework, and ensures that triggers are sent in respect of delinquent assets.
The Committee also ensures that adequate provisions are taken in line with the regulatory guidelines. The members of the Committee include the Deputy Managing Director, the Executive Directors, and relevant senior management staff of the Bank. The Committee meets regularly to review the Bank's portfolio, but not less than four times a year.