GTBank 2019 Annual Report - Web Version

GUARANTY TRUST BANK PLC #EnrichingLives 2019 Annual Report || 1

Introduction

Guaranty Trust Bank’s Consolidated Financial State-
ments complies with the applicable legal Require-
ments of the Nigerian Securities and Exchange
Commission regarding Annual Financial Statements
and comprises Separate and Consolidated Financial
Statements of the Bank and the Group for the fi-
nancial year ended 31 December, 2019. The con-
solidated financial statements have been prepared
in accordance with International Financial Reporting
Standards issued by the International Accounting
Standards Board and adopted by the Financial Re-
porting Council of Nigeria. For better understand-
ing, certain disclosures and some prior year figures
have been presented in line with current year fig-
ures. Due to rounding, numbers presented through-
out this document may not add up precisely to the
totals provided and percentages may not precisely
reflect the absolute figures.

GUGAURAARNATNYTYTRTURSUTSBTABNAKNKPLPCLC #E#nErincrhicinhginLgivLeivses 20210919AAnnnuualaRl Repepoortrt|| || 1

TABLE OF
CONTENTS

Overview Internal Control and Risk Management Systems 044

Vision & Mission Statements 004 Chairman’s Statement 047

Directors, Officers & Professional 005 Managing Director’s Statement 053
Advisers Directors’ Report 059
Statement of Directors’ Responsibilities 068
Result at a Glance 006

GROSS EARNINGS PROFIT BEFORE TAX PROFIT AFTER TAX

N435.31billion N231.71billion N196.85billion

Notice of Annual General Meeting 007 Report of the Audit Committee 069
Report of the Independent Consultants
Corporate Governance 008 on the Appraisal of the Board 070
Report of the Independent Auditor to
• Introduction 009 the Members of Guaranty Trust Bank plc 071

• Governance Structure 009 Financial Statement 076
077
Subsidiary Governance 023 • Statements of Financial Position 079
Sustainability Report 027 • Income Statements 080
Complaints and Feedback 037 • Statements of Comprehensive Income 081
AML/CFT Framework 040 • Consolidated Statement of Changes in Equity 085
• Statement of Cash - Flows

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Accounting Policies 087 Five Year Financial Summary 332

• Reporting Entity 088 • Statements of Financial Position (Group) 333
• Basis of Preparation 088 • Statements of Comprehensive Income (Group) 334
• Significant Accounting Policies 088 • Statements of Financial Position (Parent) 335
• Statements of Comprehensive Income (Parent) 336

Financial Risk Management 105 Share Capitalisation History 337

• Credit Risk 109 Corporate Information 340
• Liquidity Risk 170 341
• Settlement Risk 187 • List of Management Team
• Market Risk 187 344
Including Subsidiaries
Other notes to the Financial Statements 205 Products and Services 360

• Capital Management & Other Risks 206 Corporate Social Responsibility 363
• Use of Estimates and Judgements 208 365
• Operating Segments 218 Corporate Directory 366
• Financial Assets and Liabilities 229
• Notes to the Statements of Comprehensive 233 • Correspondent Banking Relationships
• Branch Network
Income and Statements of Financial position 306
306
• Dividends 307
• Contingencies 309
• Group Entities 313
• Related Parties
• Restatement of Comparative Financial Forms 376

Information • Mandate for e-Dividend payment 378
• Unclaimed Dividend Warrant Form 380
Other National Disclosure/Other Information 316 • Proxy Form 382
• Shareholder’s Data Update Forms 384
Statement of Prudential Adjustment 321 • Notes 385

Operational Risk Management 323

Activities of Card Operations 326

Value Added Statements 329

View our Annual Report Online
www.gtbank.com

GUARANTY TRUST BANK PLC #EnrichingLives 2019 Annual Report || 3

VISION AND
MISSION
STATEMENT

VISION
We are a team driven to deliver the utmost in cus-
tomer service.
We are synonymous with innovation, building excel-
lence and superior financial performance and creating
role models for society.
MISSION
We are a high quality financial services provider with
the urge to be the best at all times whilst adding
value to all stakeholders.

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DIRECTORS, OFFICERS AND PROFESSIONAL ADVISERS

DIRECTORS Chairman, Board of Directors
Managing Director/CEO
1 Mrs. O. A. Demuren Non-Executive Director
2 Mr. J. K. O. Agbaje Non-Executive Director
3 Mr. K. A. Adeola Non-Executive Director
4 Mr. O. M. Agusto Non-Executive Director
5 Mr. I. Hassan Non-Executive (Independent) Director
6 Mr. H. A. Oyinlola Non-Executive (Independent) Director
7 Ms. I. L. Akpofure Non-Executive (Independent) Director
8 Mr. B. T. Soyoye Executive Director
9 Mrs. V. O. Adefala Executive Director
10 Mr. A. A. Odeyemi Executive Director
11 Mr. H. Musa Executive Director
12 Mr. J. M. Lawal Executive Director
13 Mrs. M. C. Olusanya
14 Mr. B. G. Okuntola

Company Secretary
Mr. E. E. Obebeduo
FRC/2017/NBA/00000016024

Registered Office
Plot 635, Akin Adesola Street
Victoria Island, Lagos State.

Auditors
PricewaterhouseCoopers
Landmark Towers
5B, Water Corporation Road
Victoria Island, Lagos State.

Registrar & Transfer Office
Datamax Registrars Limited
2c, Gbagada Expressway
Gbagada Phase 1, Lagos State.
Tel: +234 1 7120008-11
Fax: +234 1 7120012
Email: [email protected]

GUARANTY TRUST BANK PLC #EnrichingLives 2019 Annual Report || 5

RESULT AT A GLANCE

GROSS EARNINGS PROFIT BEFORE TAX PROFIT AFTER TAX

N435.31billion N231.71billion N196.85billion

Group Group Increase/ Parent Parent Increase/
Dec-19 Dec-18 (Decrease) Dec-19 Dec-18 (Decrease)
N’million N’million N’million N’million
% %

Major Income Statement Items 435,307 434,699 0.1 350,927 356,380 -1.5
Gross earnings 231,708 215,587 7.5 200,178 189,971 5.4
Profit before income tax 196,849 184,711 6.6 175,125 166,753 5.0
Profit after income tax
696 654 6.3 595 567 5.0
Earnings per share (Kobo)
1,500,572 1,259,010 19.2 1,300,821 1,067,999 21.8
Major Statement of Financial Position Items 2,532,540 2,273,903 11.4 2,086,810 1,865,816 11.8
Loans and advances to customers 3,758,919 3,287,343 14.3 3,097,248 2,712,521 14.2
Deposits from customers 19.3 605,890 510,186 18.8
Total assets 687,337 576,277
Total equity

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GUARANTY TRUST BANK PLC #EnrichingLives 2019 Annual Report || 7

CORPORATE
GOVERNANCE

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CORPORATE GOVERNANCE

Introduction business practices. The Bank also has an entrenched culture of
openness in which healthy discourse is encouraged and employ-
In Guaranty Trust Bank Plc (“the Bank”), we are committed to ees are mandated to report improper activities.
upholding the creed and principles of good Corporate Gover-
nance in all our operations. Our good corporate governance is The Bank complies with the requirements of the Central Bank
the bedrock of strong public trust and confidence reposed in of Nigeria (“CBN”) in respect of internal review of its compli-
us by shareholders, business partners, employees and the finan- ance status with defined corporate governance practices and
cial markets and the key to our continued long-term success. submits reports on the Bank’s compliance status to the CBN
In building our corporate governance objective, the Bank’s “Or- and the Nigeria Deposit Insurance Corporation. The Bank also
ange Rules” of Simplicity, Professionalism, Service, Friendliness, conducts an Annual Board and Directors’ Evaluation/Review/Ap-
Excellence, Trustworthiness, Social Responsibility and Innovation praisal covering all aspects of the Boards’ structure, composition,
signify the Bank’s guiding ideologies upon which it was estab- responsibilities, processes and relationships, in compliance with
lished and remain the foundation upon which we have built and the requirement of the CBN Code. To conduct the Annual Board
developed our exemplary corporate governance practices. The Appraisal for the financial year ended December 31, 2019, the
Bank’s Orange Rules are fundamental to our culture and are part Board engaged the consultancy firm of Ernst and Young LP. The
of the everyday conduct of the Bank’s business. independent consultants carried out a comprehensive review of
the effectiveness of the Board by evaluating the performance
In the pursuit to deliver greater shareholder value, we continue of the Board, the Board Committees and Directors. The report
to subject our operations to the highest standards of corporate of the Appraisal will be presented to Shareholders at the 30th
governance, which is an essential foundation for sustainable Annual General Meeting of the Bank.
corporate success. In view of globalization, digitalization and
increased penetration of artificial intelligence in the World and The Board Evaluation report for the financial year ended De-
specifically in the Banking industry, our resolve to maintain good cember 31, 2019, by the independent consultants to the Board
corporate governance principles have become more important revealed that the Bank was in substantial compliance with the
to us. A principle that guides our operations and actions is, suc- provisions of the FRC Code.
cess is only worth celebrating when achieved through a process
supported and sustained with the right values and principles, at During the 2019 financial year the Bank executed various gov-
Guaranty Trust Bank Plc, these values have been enshrined in ev- ernance initiatives/activities which included; the review of the
ery employee, processes and systems through our Orange Rules. Bank’s Corporate Governance Code and Charters of all the
Board Committees to bring them at par with leading interna-
The Bank is publicly quoted on The Nigerian Stock Exchange with tional practices and existing regulations in the Country. The Bank
Global Depositary Receipts (GDRs) listed on the London Stock Ex- also put in place a Charter for the Board of Directors to delineate
change, we remain dedicated to our duties and pledge to safe- the responsibilities of the Board. The Board and its Committees
guard and increase investor value through transparent corporate also carried out annual self-assessment to evaluate compliance
governance practices. Our Code of Corporate Governance pro- with the terms of reference as contained in their respective Char-
vides a robust framework for the governance of the Board and ters.
the Bank. The Bank ensures compliance with the Code of Cor-
porate Governance for Public Companies issued by the Securities We continue to serve customers, clients and communities; and
and Exchange Commission (“the SEC Code”), the revised Code create value for stakeholders. Entrenched in the fibre of the Bank
of Corporate Governance for Banks and Discount Houses in Ni- is the culture of openness which promotes healthy discourse and
geria issued by the Central Bank of Nigeria (“the CBN Code”) encourages employees to report improper activities. The belief
in May 2014, the Financial Reporting Council’s National Code that success is only worth celebrating when achieved the right
of Corporate Governance, 2018 (“the FRC Code”), as well as way through a process supported and sustained with the right
disclosure requirements under the Disclosure and Transparency values remains one of the Bank’s guiding principles. Our commit-
Rules of the Financial Conduct Authority (FCA), United Kingdom, ment to this principle is for us the key to keeping public trust and
which are applicable to non-United Kingdom companies with confidence in our Bank and the key to our continued long-term
Global Depositary Receipts (GDRs) listed on the London Stock success.
Exchange.
Governance Structure
The Bank’s Code of Corporate Governance (“the Code”) is con-
tinuously reviewed to align with additional legal and regulatory The Board
requirements and global best practices, in order to remain a pace
setter in the area of good corporate governance practices. In The Board of Directors is responsible for the governance of the
addition to the Code, the Bank aggressively promotes its core Bank and is accountable to shareholders for creating and deliv-
values to employees of the Bank through its Code of Profession- ering sustainable value through the management of the Bank’s
al Conduct; its Ethics Policy as well as Communications Policy, business.
which regulate employee relations with internal and external
parties. This is a strong indicator of the Bank’s determination to The Board is committed to the highest standards of business in-
ensure that its employees remain professional at all times in their tegrity, ethical values and governance; it recognises the respon-
sibility of the Bank to conduct its affairs with transparency, pru-

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CORPORATE GOVERNANCE

dence, fairness, accountability and social responsibility, thereby The Board meets quarterly and additional meetings are con-
safeguarding the interests of all stakeholders. vened as required. Material decisions may be taken between
meetings by way of written resolutions, as provided for in the
The Board puts in place an appropriate level of checks and bal- Articles of Association of the Bank. The Directors are provided
ances in order to ensure that decisions are taken with the best with comprehensive group information at each of the quarterly
interest of the Bank’s stakeholders in mind. Directors of the Board meetings and are also briefed on business developments
Bank possess the right balance of expertise, skills and experi- between Board meetings.
ence, which translates to an effective Board and an Executive
Management team capable of steering the affairs of the Bank in The Board met five (5) times during year ended December 31,
an ever changing and challenging environment. The Bank’s ro- 2019.
bust appointment and effective succession planning framework
is one way of ensuring that we continue to have the right people Responsibilities of the Board
to drive the business of the Bank in the desired direction.
The Board has ultimate responsibility for determining the strate-
The Board determines the overall strategy of the Bank and fol- gic objectives and policies of the Bank to deliver long-term value
lows up on its implementation, supervises the performance of by providing overall strategic direction within a framework of
the Bank and ensures adequate management, thus actively con- rewards, incentives and controls.
tributing to developing the Bank as a focused, sustainable and
global brand. The Board has delegated the responsibility for day-to-day oper-
ations of the Bank to Management and ensures that Manage-
The synergy between the Board and Management fosters inter- ment strikes an appropriate balance between promoting long-
active dialogue in setting broad policy guidelines in the man- term growth and delivering short-term objectives. In fulfilling its
agement and direction of the Bank to enhance optimal perfor- primary responsibility, the Board acknowledges the relationship
mance and ensure that associated risks are properly managed. between good governance and risk management practices, in
Furthermore, the Board plays a central role in conjunction with relation to the achievement of the Bank’s strategic objectives and
Management in ensuring that the Bank is financially strong, well good financial performance.
governed and risks are identified and well mitigated.
Notwithstanding the delegation of the operation of the Bank
In addition to the Board’s direct oversight, the Board exercises to Management, the Board reserved certain powers which in-
its oversight responsibilities through six (6) Committees, namely, clude the approval of quarterly, half-yearly and full year financial
Board Risk Management, Board Credit, Board Human Resources statements (whether audited or unaudited) and any significant
and Nominations, Board Remuneration, Board Information Tech- change in accounting policies and/or practices; approval of ma-
nology Strategy, and the Board Audit. In addition to the Board jor changes to the Bank’s corporate structure and changes re-
Committees, the Statutory Audit Committee of the Bank, which lating to the Bank’s capital structure or its status as a public lim-
comprises equal numbers of representatives of the Board and ited company; the determination and approval of the strategic
Shareholders, also performs its statutory role as stipulated by the objectives and policies of the Bank to deliver long-term value;
Companies and Allied Matters Act (2004). approval of the Bank’s strategy, medium and short term plan
and its annual operating and capital expenditure budget; ap-
Members of the Board of Directors are seasoned professionals, pointment or removal of Company Secretary; recommendation
who have excelled in various sectors including banking, account- to shareholders of the appointment or removal of auditors and
ing, engineering, oil and gas, manufacturing as well as law. They the remuneration of Auditors; approval of resolutions and corre-
possess the requisite integrity, skills and experience to bring to sponding documentation for shareholders in general meeting(s),
bear independent judgment on the deliberations of the Board shareholders circulars, prospectus and principal regulatory filings
and decisions of the Board (without prejudice to Directors’ right with the Regulators.
to earn Directors’ fees and hold interest in shares). They have a
good understanding of the Bank’s businesses and affairs to en- Other powers reserved for the Board are the determination of
able them properly evaluate information and responses provided Board structure, size and composition, including appointment
by Management, and to provide objective challenge to manage- and removal of Directors, succession planning for the Board and
ment. senior management and Board Committee membership; ap-
proval of mergers and acquisitions, branch expansion and es-
Directors are prepared to challenge each other’s assumptions, tablishment of subsidiaries; approval of remuneration policy and
beliefs or viewpoints as necessary for the good of the Bank and packages of the Managing Director and other Board members,
question intelligently, debate constructively and make decisions appointment of the Managing Director and other Directors of
dispassionately. subsidiaries nominated by the Bank; approval of the Board per-
formance evaluation process, corporate governance framework
Three (3) of the Non-Executive Directors are “Independent Di- and review of the performance of the Managing Director; ap-
rectors”, appointed based on the core values enshrined in the proval of policy documents on significant issues including En-
Bank’s Code of Corporate Governance and the criteria laid down terprise-wide Risk Management, Human Resources, Credit, Cor-
by the CBN for the appointment of Independent Directors. The porate governance and Anti – Money laundering, and approval
Independent Directors do not have any significant shareholding
interest or any special business relationship with the Bank.

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CORPORATE GOVERNANCE

of all matters of importance to the Bank as a whole because ment, the key issues the Bank faces, and to introduce Directors
of their strategic, financial, risk or reputational implications or to their fiduciary duties and responsibilities.
consequences.
The Bank attaches great importance to training its Directors and
Roles of Chairman and Chief Executive for this purpose, continuously offers training and education from
onshore and offshore institutions to its Directors, in order to en-
The roles of the Chairman and Chief Executive are separate and hance their performance on the Board and the various commit-
no one individual combines the two positions. The Chairman’s tees to which they belong. The Bank’s Non-Executive Directors
main responsibility is to lead and manage the Board to ensure attended foreign and/or local courses in the year ended Decem-
that it operates effectively and fully discharges its legal and reg- ber 31, 2019.
ulatory responsibilities. The Chairman is responsible for ensuring
that Directors receive accurate, timely and clear information to Changes on the Board
enable the Board take informed decisions and provide advice to
promote the success of the Bank. The Chairman also facilitates In the course of the financial year ended December 31, 2019,
the contribution of Directors and promotes effective relation- there was no change on the Board.
ships and open communications between Executive and Non-Ex-
ecutive Directors, both inside and outside the Boardroom. Retirement by Rotation

The Board has delegated the responsibility for the day-to-day The provisions of Article 84(b) of the Articles of Association of
management of the Bank to the Managing Director/Chief Ex- the Bank provides that one third of the Directors (excluding Exec-
ecutive Officer, who is supported by Executive Management. utive Directors) or if their number is not a multiple of three, the
The Managing Director executes the powers delegated to him number nearest to but not greater than one third, should retire
in accordance with guidelines approved by the Board of Direc- from office at each biennial Annual General Meeting. In view
tors. Executive Management is accountable to the Board for the of the fact that we had two Directors retire by rotation at the
development and implementation of strategies and policies. The 29th Annual General Meeting, in compliance with this section,
Board regularly reviews group performance, matters of strategic no Director would be retiring by rotation at the 30th Annual
concern and any other matter it regards as material. General Meeting.

Director Nomination Process Non-Executive Directors’ Remuneration

The Board Human Resources and Nominations Committee is The Bank’s policy on remuneration of Non-Executive Directors is
charged with the responsibility of leading the process for Board guided by the provisions of the CBN Code and the Financial Re-
appointments and for identifying and nominating suitable can- porting Council (FRC) Code, which stipulates that Non-Executive
didates for the approval of the Board. Directors’ remuneration should be limited to sitting allowances,
Directors’ fees and reimbursable travel and hotel expenses.
With respect to new appointments, the Board Human Resourc-
es and Nominations Committee identifies, reviews and recom- Summary of remuneration paid to Executive and Non-Executive
mends candidates for potential appointment as Directors. In Directors is contained in Note 46 of this report.
identifying suitable candidates, the Committee considers candi-
dates on merit against objective criteria and with due regard for Board Committees
the benefits of diversity on the Board, including gender as well as
the balance and mix of appropriate skills and experience. The Board carries out its responsibilities through its Standing
Committees, which have clearly defined terms of reference,
Shareholding in the Bank is not considered a criterion for the setting out their roles, responsibilities, functions and scope of
nomination or appointment of a Director. The appointment of authority. The Board has six (6) Standing Committees in addition
Directors is subject to the approval of the shareholders and the to the Statutory Audit Committee of the Bank, namely; Board
Central Bank of Nigeria. Risk Management Committee, Board Credit Committee, Board
Human Resources and Nominations Committee, Board Remu-
Induction and Continuous Training neration Committee, Board Information Technology Strategy
Committee and Board Audit Committee. Through these Com-
Upon appointment to the Board and to Board Committees, all mittees, the Board is able to effectively carry out its oversight
Directors receive an induction tailored to meet their individual responsibilities and take advantage of individual expertise to
requirements. formulate strategies for the Bank. The Committees make rec-
ommendations to the Board, which retains responsibility for final
The induction, which is arranged by the Company Secretary, may decision making.
include meetings with senior management staff and key external
advisors, to assist Directors in acquiring a detailed understanding All Committees in the exercise of their powers so delegat-
of the Bank’s operations, its strategic plan, its business environ-

GUARANTY TRUST BANK PLC #EnrichingLives 2019 Annual Report || 11

CORPORATE GOVERNANCE

ed conform to the regulations laid down by the Board, with framework annually, in order to satisfy itself on the design
well-defined terms of reference contained in the Charter of each and completeness of the framework relative to the activities
Committee. The Committees render reports to the Board at the and risk profile of the Bank and its subsidiaries;
Board’s quarterly meetings.
• To oversee Management’s process for the identification of
A summary of the roles, responsibilities, composition and fre- significant risks across the Bank and the adequacy of risk mit-
quency of meetings of each of the Committees are as stated igation, prevention, detection and reporting mechanisms;
hereunder:
• To review and recommend to the Board for approval, the
Board Risk Management Committee contingency plan for specific risks;

This Committee is tasked with the responsibility of setting and • To review the Bank’s compliance level with applicable laws
reviewing the Bank’s risk policies. The coverage of supervision and regulatory requirements which may impact on the Bank’s
includes the following: Credit Risk, Reputational Risk, Operations risk profile;
Risk, Technology Risk, Market Risk, Liquidity Risk and other per-
vasive risks as may be posed by the events in the industry at any • To conduct periodic review of changes in the economic and
point in time. business environment, including emerging trends and other
factors relevant to the Bank’s risk profile;
The Terms of Reference of the Board Risk Management Com-
mittee include: • To handle any other issue referred to the Committee from
time to time by the Board.
• To review and recommend for the approval of the Board, the
Bank’s Risk Management Policies including the risk profile The Chief Risk Officer of the Bank presents regular briefings to
and limits; the Committee at its meetings.

• To determine the adequacy and effectiveness of the Bank’s The Committee meets quarterly and additional meetings are
risk detection and measurement systems and controls; convened as required. The Committee met four (4) times during
the financial year ended December 31, 2019.
• To evaluate the Group’s internal control and assurance

The Board Risk Management Committee comprised the following members during the year under review:

S/No Name Status Designation Dates of Attendance
1. Mr. H. A. Oyinlola Non-Executive Director Chairman
29-Jan-2019
2. Mr. J. K. O. Agbaje Managing Director Member 16-Apr-2019
23-July-2019
3. Ms. I. L. Akpofure Non-Executive (Independent) Member 29-Oct-2019

Director 29-Jan-2019
16-Apr-2019
4. Mr. B. T. Soyoye Non-Executive (Independent) Member 23-July-2019
29-Oct-2019
Director
29-Jan-2019
5. Mrs. V. O. Adefala Non-Executive (Independent) Member 16-Apr-2019
23-July-2019
Director 29-Oct-2019

6. Mr. A. A. Odeyemi Executive Director Member 29-Jan-2019
16-Apr-2019
7. Mrs. M. C. Olusanya Executive Director Member 23-July-2019
29-Oct-2019

29-Jan-2019
16-Apr-2019
23-July-2019
29-Oct-2019

29-Jan-2019
16-Apr-2019
23-July-2019
29-Oct-2019

29-Jan-2019
16-Apr-2019
23-July-2019
29-Oct-2019

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CORPORATE GOVERNANCE

Board Credit Committee • To review the Asset and Liability Management of the Bank;

This Committee is responsible for approval of credit facilities in • To ensure that the Bank complies with regulatory require-
the Bank. The Terms of Reference of the Board Credit Commit- ments regarding the grant of credit facilities;
tee include:
• To handle any other issue referred to the Committee from
• To consider and approve specific loans above the Manage- time to time by the Board.
ment Credit Committee’s authority limit, as determined by
the Board from time to time; In view of the volume of transactions that require Board
Credit Committee approvals, there are instances where the
• To review Management Credit Committee’s authority level as need arises for credits to be approved by members expedi-
and when deemed necessary and recommend new levels to tiously between Board Credit Committee Meetings. Such urgent
the Board for consideration; credits are circulated amongst the members for consideration
and approval in line with a defined procedure that ensures that
• To conduct quarterly review of credits granted by the Bank to all members of the Committee are furnished with full informa-
ensure compliance with the Bank’s internal control systems tion on such credits. All credits considered as “Large Exposures”
and credit approval procedures; as defined by the Board of Directors from time to time are con-
sidered and approved by the Board Credit Committee at a spe-
• To notify all Director related loans to the Board; cial meeting convened for that purpose.

• To monitor and notify the top debtors to the attention of the The Board Credit Committee meets at least once in each quar-
Board; ter. However, additional meetings are convened as required. The
Committee met Five (5) times during the financial year ended
• To review the Bank’s internal control procedures in relation December 31, 2019.
to credit risk assets and ensure that they are sufficient to
safeguard the quality of the Bank’s risk assets;

The Board Credit Committee is made up of the following members:

S/No Name Status Designation Dates of Attendance
1 Mr. O. M. Agusto Non-Executive Director Chairman
29-Jan-2019
2 Mr. K. A. Adeola Non-Executive Director Member 16-Apr-2019
23-July-2019
3 Mr. I. Hassan Non-Executive Director Member 29-Oct-2019
13-Nov-2019
4 Mrs. V.O. Adefala Non-Executive (Independent) Member
29-Jan-2019
Director 16-Apr-2019
23-July-2019
5 Mr. H. Musa Executive Director Member 29-Oct-2019
13-Nov-2019
6 Mr. J. M. Lawal Executive Director Member
29-Jan-2019
7 Mr. B. G. Okuntola Executive Director Member 16-Apr-2019
23-July-2019
29-Oct-2019
13-Nov-2019

29-Jan-2019
16-Apr-2019
23-July-2019
29-Oct-2019
13-Nov-2019

29-Jan-2019
16-Apr-2019
23-July-2019
29-Oct-2019
13-Nov-2019

29-Jan-2019
16-Apr-2019
23-July-2019
29-Oct-2019
13-Nov-2019

29-Jan-2019
16-Apr-2019
23-July-2019
29-Oct-2019
13-Nov-2019

GUARANTY TRUST BANK PLC #EnrichingLives 2019 Annual Report || 13

CORPORATE GOVERNANCE

Board Human Resources and Nominations Commit- induction and continuous education, approval of promotion of top
tee management staff, corporate governance, succession planning, con-
flict of interest situations and compliance with legal and regulatory
This Committee is responsible for the approval of human resource provisions.
matters, identification and nomination of candidates for appoint-
ment to the Board and Board governance issues such as annual eval- The Committee is also responsible for the oversight of strategic peo-
uation of the performance of the Managing Director and the Board, ple issues, including employee retention, equality and diversity as
well as other significant employee relations matters.

The membership of the Committee is as follows:

S/No Name Status Designation Dates of Attendance
1 Mr. I. Hassan Non-Executive Director Chairman
28-Jan-2019
2 Mr. J.K.O. Agbaje Managing Director Member 15-Apr-2019
22-July-2019
3 Mr. H.A. Oyinlola Non-Executive Director Member 28-Oct-2019

4 Ms. I. L. Akpofure¹ Non-Executive (Independent) Member 28-Jan-2019
15-Apr-2019
Director 22-July-2019
28-Oct-2019
5 Mr. B. T. Soyoye Non-Executive (Independent) Member
28-Jan-2019
Director 15-Apr-2019
22-July-2019
6 Mrs. M. C. Olusanya Executive Director Member 28-Oct-2019

28-Jan-2019
15-Apr-2019

28-Jan-2019

28-Jan-2019
15-Apr-2019
22-July-2019
28-Oct-2019

1Stepped down from the Committee at the Board Meeting which held in April 2019

The Committee is required to meet at least once a year, and across the Bank, determining the policy of the Bank on the re-
additional meetings may be convened as the need arises. The muneration of the Managing Director and other Executive Di-
Committee met four times during the financial year ended De- rectors and the specific remuneration packages and to approve
cember 31, 2019. the policy relating to all remuneration schemes and long-term
incentives for employees of the Bank,

Board Remuneration Committee

The Board Remuneration Committee has the responsibility of
setting the principles and parameters of Remuneration Policy

The Board Remuneration Committee is made up of the following members:

S/No Name Status Designation Dates of Attendance
1 Mr. O. M. Agusto Non-Executive Director Chairman 30-Jan-2019
2 Mr. K.A Adeola Non-Executive Director Member 30-Jan-2019
3 Mrs. V.O. Adefala1 Non-Executive (Independent) Director Member N/A

1 Appointed as a member of the Committee at the Board Meeting held on January 30, 2019

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The Committee is required to meet at least once a year, and The Terms of Reference of the Board Information Technology
additional meetings may be convened as the need arises. The Strategy Committee include:
Committee met once during the year.
• To provide advice on the strategic direction of Information
Board Information Technology Strategy Committee Technology issues in the Bank;

The Board Information Technology Strategy Committee is re- • To inform and advise the Board on important Information
sponsible for the provision of strategic guidance to Management Technology issues in the Bank;
on Information Technology issues and monitoring the effective-
ness and efficiency of Information Technology within the Bank • To monitor overall Information Technology performance and
and the adequacy of controls. practices in the Bank.

The Board Information Technology Strategy Committee comprised the following members during the year under review:

S/No Name Status Designation Dates of Attendance
1 Mr K. A. Adeola Non-Executive Director Chairman
2 Mr J. K. O. Agbaje Non-Executive Director Member 15-Apr-2019
3 Mr. H.A. Oyinlola Non-Executive Director Member 28-Oct-2019
4 Ms. I. L. Akpofure Non-Executive (Independent) Director Member
5 Mr A. A. Odeyemi Executive Director Member 15-Apr-2019
6 Mr. H. Musa Executive Director Member 28-Oct-2019
7 Mr. J. M. Lawal Executive Director Member
15-Apr-2019
28-Oct-2019

15-Apr-2019
28-Oct-2019

15-Apr-2019
28-Oct-2019

15-Apr-2019
28-Oct-2019

15-Apr-2019
28-Oct-2019

The Committee is required to hold its Meetings twice in a year. • To review the Management Letter of the External Auditor
The Committee met two (2) times in the financial year ended and Management’s response thereto;
December 31, 2019.
• To review the appropriateness and completeness of the
Board Audit Committee Bank’s statutory accounts and its other published financial
statements;
The Board Audit Committee is responsible for oversight of audit
functions, without prejudice to the statutory Audit Committee • To oversee the independence of the external auditors;
established in compliance with CAMA, which is not considered
a board committee. • To receive a summary of whistle blowing cases reported and
the result of the investigation from the Head of Internal Au-
The Terms of Reference of the Board Audit Committee include: dit;

• To keep the effectiveness of the Bank’s system of accounting, • To ensure that the Bank’s Investment Valuation Policy is up-
reporting and internal control under review and to ensure dated to take into account changes in International Finan-
compliance with legal and agreed ethical requirements; cial Reporting Standards (IFRS) as issued and/or amended
from time to time by the International Accounting Standards
• To review the activities, findings, conclusions and recommen- Board and/or in valuation techniques as recommended by
dations of the external auditors relating to the Bank’s annual the European Venture Capital Association and best practices.
audited financial statements;

GUARANTY TRUST BANK PLC #EnrichingLives 2019 Annual Report || 15

CORPORATE GOVERNANCE

The Board Audit Committee comprised the following members during the year under review:

S/No Name Status Designation Dates of Attendance
1 Ms. I. L. Akpofure Chairman
Non-Executive (Independent) 28-Jan-2019
Director 15-Apr-2019
22-July-2019
2 Mr. O. M. Agusto Non-Executive Director Member 28-Oct-2019

3 Mr. I. Hassan Non-Executive Director Member 28-Jan-2019
15-Apr-2019
22-July-2019
28-Oct-2019

28-Jan-2019
15-Apr-2019
22-July-2019
28-Oct-2019

The Committee is required to hold its Meetings once every quar- auditors and there is no conflict of interest. The Committee has
ter. The Committee met four (4) times during the year under access to external auditors to seek explanations and additional
review. information, while the internal and external auditors have unre-
stricted access to the Committee, which ensures that their inde-
Statutory Audit Committee of the Bank pendence is in no way impaired.

This Committee is responsible for ensuring that the Bank com- The Committee is made up of three (3) Non-Executive Directors
plies with all the relevant policies and procedures both from the and three (3) Shareholders of the Bank appointed at Annual
regulators and as laid-down by the Board of Directors. Its major General Meetings. The membership of the Committee at the
functions include the approval of the annual audit plan of the Board level is based on relevant experience of the Board mem-
internal auditors, review and approval of the audit scope and bers, while one of the shareholders serves as the Chairman of
plan of the external auditors, review of the audit report on in- the Committee.
ternal weaknesses observed by both the internal and external
auditors during their respective examinations and to ascertain The internal and external auditors are invited from time to time
whether the accounting and reporting policies of the Bank are in to attend the Meetings of the Committee. The Chief Financial
accordance with legal requirements and agreed ethical practices. Officer and appropriate members of Management also attend
the meetings upon invitation. The Committee is required to
The Committee also reviews the Bank’s annual and interim fi- meet quarterly and additional meetings may be convened as the
nancial statements, particularly the effectiveness of the Bank’s need arises.
disclosure controls and systems of internal control as well as ar-
eas of judgment involved in the compilation of the Bank’s results.
The Committee is responsible for the review of the integrity of
the Bank’s financial reporting and oversees the independence
and objectivity of the external auditors, review and ensure that
adequate whistle blowing procedures are in place and that a
summary of issues reported are highlighted to the Committee
and review the independence of the external auditors and en-
sure that where non-audit services are provided by the external

16 || 2019 Annual Report GUARANTY TRUST BANK PLC #EnrichingLives

CORPORATE GOVERNANCE

The Statutory Audit Committee of the Bank met four (4) times during the year. The following members served on the Committee
during the year ended December 31 2019:

S/No Name Status Designation Attendance Dates of
1 Attendance
2 Mrs. S. O. J. Mbagwu-Fagbemi 1 Shareholders’ Representative Chairman 4
3 28-Jan-2019
4 Alhaji M. O. Usman 2 Shareholders’ Representative Member 4 15-Apr-2019
5 22-July-2019
6 Mrs. A. Kuye Shareholders’ Representative Member 4 28-Oct-2019

Mr. I. Hassan Non-Executive Director Member 4 28-Jan-2019
15-Apr-2019
Mr. O. M. Agusto Non-Executive Director Member 4 22-July-2019
28-Oct-2019
Ms. I. L. Akpofure Non-Executive (Independent) Member 4
Director 28-Jan-2019
15-Apr-2019
22-July-2019
28-Oct-2019

28-Jan-2019
15-Apr-2019
22-July-2019
28-Oct-2019

28-Jan-2019
15-Apr-2019
22-July-2019
28-Oct-2019

28-Jan-2019
15-Apr-2019
22-July-2019
28-Oct-2019

1 Appointed as the Chairman of the Committee at the Meeting which held in July, 2019
2 Stepped down from the chairmanship position in July 2019, however remains a member of the Committee

GUARANTY TRUST BANK PLC #EnrichingLives 2019 Annual Report || 17

CORPORATE GOVERNANCE

Attendance of Board and Board Committee Meetings

The table below shows the frequency of meetings of the Board of Directors and Board Committees, as well as Members’ attendance for the year
ended December 31, 2019.

S/N Directors Board Board Risk Board Board Board I.T. Board
Credit Management Human Remuneration Strategy Audit
Board Committee Resources Committee
Committee Committee
&
Nomination
Committee

Date of 30-Jan-2019 29-Jan-2019 29-Jan-2019 28-Jan-2019 30-Jan-2019 15-Apr-2019 28-Jan-2019
Meetings 17-Apr-2019 16-Apr-2019 16-Apr-2019 15-Apr-2019 28-Oct-2019 15-Apr-2019
24-July-2019 23-July-2019 23-July-2019 22-July-2019 22-July-2019
30-Oct-2019 29-Oct-2019 29-Oct-2019 28-Oct-2019 28-Oct-2019
13-Nov-2019 13-Nov-2019

Number of 55 44 1 24
Meetings

1 Mrs. O. A. Demuren1 5 N/A N/A N/A N/A N/A N/A

2 Mr. J. K. O Agbaje 5 N/A 4 4 N/A 2 N/A

3 Mr. O. M. Agusto 55 N/A N/A 1 N/A 4

4 Mr. K. A. Adeola 55 N/A N/A 1 2 N/A

5 Mr. I. Hassan 55 N/A 4 N/A N/A 4

6 Mr. H. A. Oyinlola 5 N/A 4 4 N/A 2 N/A

7 Ms. I. Akpofure2 5 N/A 4 2 N/A 2 4

8 Mr. B. T. Soyoye 4 N/A 4 1 N/A N/A N/A

9 Mrs. V. O. Adefala3 55 4 N/A N/A N/A N/A

10 Mr. A. A. Odeyemi 5 N/A 4 N/A N/A 2 N/A

11 Mr. H. Musa 55 N/A N/A N/A 2 N/A

12 Mr. J. M. Lawal 55 N/A N/A N/A 2 N/A

13 Mrs. M. C. Olusanya 5 N/A 4 4 N/A N/A N/A

14 Mr. B. G. Okuntola 55 N/A N/A N/A N/A N/A

1 The Chairman is not a member of any Committee in compliance with the CBN Code which prohibits the chairman of the Board from being a member of any Committee;

2 Stepped down from the Board Human Resources and Nominations Committee at the Board Meeting held on April 17, 2019

3 Appointed to the Board Remuneration Committee at the Board Meeting held on January 30, 2019

N/A -Not Applicable

18 || 2019 Annual Report GUARANTY TRUST BANK PLC #EnrichingLives

CORPORATE GOVERNANCE

Tenure of Directors Protection of Shareholders’ Rights

In order to ensure both continuity and injection of fresh ideas, The Board ensures the protection of the statutory and general
the tenure for Non-Executive Directors is limited to a maximum rights of shareholders at all times, particularly their right to vote
of three (3) terms of four (4) years each, i.e. twelve (12) years at general meetings. All shareholders are treated equally, regard-
whilst the maximum tenure for Independent Non-Executive Di- less of volume of shareholding or social status.
rectors is limited to a maximum of two (2) terms of four (4) years
each, i.e. eight (8) years. Communication Policy

This is in compliance with the directives of the CBN Code. The Board and Management of the Bank ensure that commu-
nication and dissemination of information regarding the opera-
Board Appraisal tions and management of the Bank to shareholders, stakehold-
ers and the public is timely, accurate and continuous, to give a
In the Bank’s customary manner of imbibing the best corporate balanced and fair view of the Bank’s financial and non-financial
governance practices, the Board engaged an Independent Con- matters. Such information, which is in plain language, readable
sultant, Ernst and Young LP, to carry out the annual Board and and understandable, is available on the Bank’s website, http://
Directors appraisal for the 2019 financial year. The annual ap- www.gtbank.com. The website is constantly updated with infor-
praisal covered all aspects of the Board’s structure, composition, mation as events occur.
responsibilities, processes, relationships, individual members’
competencies and respective roles in the Board performance, as The website also has an Investors Relations portal where the
well as the Bank’s compliance status with the provisions of the Bank’s financial Reports and other relevant information about
CBN and SEC Codes. the Bank is published and made accessible to its shareholders,
stakeholders and the public.
The Annual Board and Director Review/Appraisal Report for the
2019 financial year will be presented to shareholders at the 30th The main objective of the Bank’s Communication Policy is to
Annual General Meeting of the Bank. support the Bank in achieving the overall goals described in the
Bank’s core values which strengthens the Bank’s culture of trans-
Shareholders parency in pursuit of best corporate governance practices.

The General Meeting of the Bank is the highest decision-making In order to reach its overall goal on information dissemination,
body of the Bank. The Bank’s General Meetings are conducted in the Bank is guided by the following principles:
a transparent and fair manner. Shareholders have the opportu-
nity to express their opinions on the Bank’s financial results and (i) Compliance with Rules and Regulations: The Bank complies
other issues affecting the Bank. The Annual General Meetings with the legislation and codes of corporate governance of
are attended by representatives of regulators such as the Central the jurisdictions within which it operates. These include
Bank of Nigeria, the Securities and Exchange Commission, the the Banks and other Financial Institutions Act (BOFIA), the
Nigerian Stock Exchange, the Corporate Affairs Commission as Companies and Allied Matters Act (CAMA) and the codes
well as representatives of Shareholders’ Associations. of Corporate Governance issued by the Central Bank of
Nigeria as well as the Securities and Exchange Commis-
The Bank has an Investors Relations Unit, which deals directly sion, Financial Reporting Council, the United Kingdom
with enquiries from shareholders and ensures that Shareholders’ Listing Authority (“UKLA”) (by virtue of the listing of Glob-
views are escalated to Management and the Board. In addition, al Depositary Receipts by the Bank on The London Stock
quarterly, half-yearly and annual financial results are published in Exchange in July 2007);
widely read national newspapers.
(ii) Efficiency: The Bank uses modern communication tech-
The Bank ensures that institutional investors and international nologies in a timely manner to convey its messages to its
holders of the Global Depositary Receipts get frequent updates target groups. Synergies are sought when it comes to us-
on the Bank’s progress via interactive conference calls, local and ing different communication channels. The Bank replies
international investor presentations and meetings. These confer- without unnecessary delay to information requests by the
ence calls and investor meetings provide our investors with direct media and the public;
access to senior and executive Management.
(iii) Transparency: As an international financial institution, the
Bank strives in its communication to be as transparent and
open as possible while considering the concept of confi-
dentiality between the Bank and its customers, and bank
secrecy. This contributes to maintaining a high level of ac-
countability;

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CORPORATE GOVERNANCE

(iv) Pro-activity: The Bank proactively develops contacts with Insider Trading and price sensitive
its target groups and identifies topics of possible mutual information
interest;
The Bank has in place a policy regarding trading in its shares by
(v) Clarity: The Bank aims at clarity, i.e. to send uniform and its Directors and employees on the terms and conditions similar
clear messages on key issues; to the standards set out by the Nigerian Stock Exchange. The
policy is periodically circulated on the Bank’s internal commu-
(vi) Cultural awareness: As an international financial institu- nication network (“Intranet”) to serve as a reminder to staff of
tion, the Bank operates in a multicultural environment and their obligations thereunder.
accordingly recognizes the need to be sensitive to the cul-
tural peculiarities of its operating environment; Directors, insiders and their related persons in possession of con-
fidential price sensitive information (“insider information”) are
(vii) Feedback: The Bank actively and regularly seeks feedback prohibited from dealing with the securities of the Bank where
on its image and communication activities both from the such would amount to insider trading. Directors, insiders and
media as well as from its key target groups. This feedback related parties are prohibited from disposing, selling, buying or
is used to fine-tune communication activities. transferring their shares in the Bank for a “lock up” period com-
mencing from the date of receipt of such insider information
Information Flow until such a period when the information is released to the public
or any other period as defined by the Bank from time to time.
It is the responsibility of Executive Management under the direc-
tion of the Board, to ensure that the Board receives adequate In addition to the above, the Bank makes necessary disclosure as
information on a timely basis, about the Bank’s businesses and required under Rule 111 of the Securities and Exchange Com-
operations at appropriate intervals and in an appropriate man- mission (“SEC”) Rules and Regulations which stipulates that Di-
ner, to enable the Board to carry out its responsibilities. rectors and top Management employees and other insiders of
public companies shall notify the SEC of any sale or purchase of
The Company Secretary shares in the company, not later than forty-eight (48) hours after
such activity.
The Company Secretary provides a point of reference and sup-
port for all Directors. The Company Secretary also consults regu- The Directors of the Bank comply strictly with the laid down pro-
larly with Directors to ensure that they receive required informa- cedure and policy regarding trading in the Bank’s shares.
tion promptly. The Board may obtain information from external
sources, such as consultants and other advisers, if there is a need Management Committees
for outside expertise, via the Company Secretary or directly.
These are Committees comprising senior management staff of
The Company Secretary is also responsible for assisting the Board the Bank. The Committees are risk driven as they are basical-
and Management in the implementation of the Code of Cor- ly set up to identify, analyze, synthesize and make recommen-
porate Governance of the Bank, coordinating the orientation dations on risks arising from day to day activities of the Bank.
and training of new Directors and the continuous education of They also ensure that risk limits as contained in the Board and
Non-Executive Directors; assisting the Chairman and Managing Regulatory policies are complied with at all times. They provide
Director to formulate an annual Board Plan and with the admin- inputs for the respective Board Committees and also ensure that
istration of other strategic issues at the Board level; organizing recommendations of the Board Committees are effectively and
Board meetings and ensuring that the minutes of Board meet- efficiently implemented. They meet as frequently as necessary
ings clearly and properly capture Board discussions and decisions. to immediately take action and decisions within the confines of
their powers.
Independent professional advice is available, on request, to all
Directors at the Bank’s expense when such advice is required to The standing Management Committees in the Bank are:
enable a Member of the Board effectively perform certain re- • Management Risk Committee;
sponsibilities. • Management Credit Committee;
• Criticized Assets Committee;
The Bank meets the costs of independent professional advice • Assets and Liability Management Committee;
obtained jointly or severally by a Director or Directors where • Information Technology (IT) Steering Committee;
such advice is necessary to enable the obligations imposed on • Information Technology (IT) Risk Management Committee
an individual, through membership of the Board, to be properly
fulfilled.

20 || 2019 Annual Report GUARANTY TRUST BANK PLC #EnrichingLives

CORPORATE GOVERNANCE

Management Risk Committee line with the regulatory guidelines.

This Committee is responsible for regular analysis and consider- Assets and Liability Management
ation of risks in the Bank. The Committee meets from time to Committee
time and at least quarterly. However, additional meetings may be
held if required. The Committee reviews and analyses environ- This Committee is responsible for the management of a variety
mental issues and policies impacting either directly or remotely of risks arising from the Bank’s business including, market and
on the Bank, brainstorms on such issues and recommends steps liquidity risk management, loan to deposit ratio analysis, cost
to be taken by the Bank. The Committee’s approach is risk based. of funds analysis, establishing guidelines for pricing on deposit
and credit facilities, exchange rate risks analysis, balance sheet
The Committee provides inputs for the Board Risk Management structuring, regulatory considerations and monitoring of the sta-
Committee and also ensures that the decisions and policies ema- tus of implemented assets and liability strategies. The members
nating from the Committee’s meetings are implemented. of the Committee include the Managing Director, Executive
Directors, the Treasurer, the Head of the Financial Control Group,
The mandate of the Committee includes; the Chief Risk Officer as well as a representative of the Assets
and Liability Management Unit.
• The review of the effectiveness of GTBank’s overall risk man-
agement strategy at the enterprise level; Information Technology (IT) Steering
Committee
• The follow-up on management action plans based on the
status of implementation compiled by the Management Risk The Committee is responsible for assisting Management with
Committee; the implementation of IT strategy approved by the Board. The
roles and responsibilities of the Committee include:
• The identification and evaluation of new strategic risks in-
cluding corporate matters involving regulatory, business de- 1. Planning, Budgeting and Monitoring
velopment issues, etc., and the suitability of mitigants; • Review and approval of the Bank’s IT plan and budget
(short and long term).
• The review of the enterprise risk scorecard and determination • Review IT performance against plans and budgets, and
of the risks to be escalated to the Board on a quarterly basis. recommend changes, as required.
• Review, prioritization and approve IT investment initia-
Management Credit Committee tives.
• Establishment of a balance in approval of overall IT in-
This is the Committee responsible for ensuring that the Bank vestment portfolio in terms of risk, return and strategy.
complies fully with the Credit Policy Guide as laid down by the
Board of Directors. The Committee also provides inputs for the 2. Ensuring Operational Excellence
Board Credit Committee. This Committee reviews and approves • Making recommendations to Management on strategies
credit facilities to individual obligors not exceeding an aggre- for new technology and systems.
gate sum to be determined by the Board from time to time. • Review and approval of changes to IT structure, key ac-
The Management Credit Committee is responsible for reviewing countabilities, and practices.
and approving all credits that are above the approval limit of the • Ensuring project priorities and success measures are
Managing Director as determined by the Board. The Committee clearly defined, and effectively monitored.
reviews the entire credit portfolio of the Bank and conducts pe- • Conducting a review of exceptions and projects on se-
riodic assessment of the quality of risk assets in the Bank. It also lected basis.
ensures that adequate monitoring of credits is carried out. The • Performing service catalogue reviews for continued stra-
Committee meets weekly depending on the number of credit tegic relevance.
applications to be considered. • Review and approval of current and future technology
architecture for the Bank.
The secretary of the Committee is the Head of the Credit Admin-
istration Unit of the Bank.

Criticized Assets Committee

This Committee is responsible for the assessment of the risk as-
set portfolio of the Bank. It highlights the status of the Bank’s as-
sets in line with the internal and external regulatory framework
and directs appropriate actions in respect of delinquent assets.
The Committee ensures that adequate provisions are taken in

GUARANTY TRUST BANK PLC #EnrichingLives 2019 Annual Report || 21

CORPORATE GOVERNANCE

• Monitoring service levels, improvements and IT service ing procedure that ensures anonymity for whistle-blowers. The
delivery. Bank has two (2) hotlines and a direct link in the Bank’s website
provided for the purpose of whistle-blowing. The hotline num-
• Assessing and improving the Bank’s overall IT competi- bers are 01-4480905 and 01- 4480906, and the Bank’s website
tiveness. is www.gtbank.com.

3. IT Risk Assurance Internally, the Bank has a direct link on its Intranet for dissemina-
• Review and approve governance, risk and control frame- tion of information, to enable members of staff report all iden-
work. tified breaches of the Bank’s Code of Corporate Governance.
• Monitoring compliance with defined standards and
agreed performance metrics. Code of Conduct
• Ensuring that vulnerability assessments of new technolo-
gy are performed. The Bank has an internal Code of Professional Conduct for Em-
• Reviewing and ensuring the effectiveness of the IT Risk ployees “the Bank’s Code” which all members of staff subscribe
Management and Security plan. to upon assumption of duties. Staff are also required to reaffirm
• Ensuring the effectiveness of disaster recovery plans and their commitment to the Bank’s Code annually.
review reports on periodic disaster recovery testing.
• Reviewing key IT risk and security issues relevant to the All members of staff are expected to strive to maintain the high-
Bank’s IT processes / systems. est standards of ethical conduct and integrity in all aspects of
• Ensuring that the Bank complies with relevant laws and their professional life as contained in the Code of Professional
regulations. Conduct which prescribes the common ethical standards, poli-
cies and procedures of the Bank relating to employee values. The
Information Technology (IT) Risk Bank also has a Code of Conduct for Directors.
Management Committee
Human Resources Policy
The Information Technology Risk Management Committee is
responsible for establishing standardised IT risk management The Human Resources policy of the Bank is contained in the Di-
practices and ensuring compliance, for institutionalising IT risk rectors’ Report on page 66 of this Annual Report.
management in the Bank’s operations at all levels; and identi-
fying and implementing cost effective solutions for IT risk mit- Employee Share-ownership Scheme
igation. The Committee is also responsible for the continuous
development of IT risk management expertise and ensuring that The Bank has in place an employee share ownership scheme
a proactive risk management approach is adopted throughout called the Staff Investment Trust (SIT) scheme. Under the Bank’s
the Bank to drive competitive advantage. Articles of Association, the Scheme is authorized to hold up to
a specified percentage of ordinary shares of the Bank for the
Monitoring Compliance with Corporate benefit of eligible employees of the Bank.
Governance
The scheme was established for the benefit of the Bank’s staff as
Chief Compliance Officer an incentive mechanism, by enabling eligible staff invest in ordi-
nary shares of the Bank at a discount (the prevailing Net Assets
The Chief Compliance Officer monitors compliance with money Value (NAV), and buying-back their stock from the Bank at the
laundering requirements and the implementation of the Corpo- market price, subject to attaining a determined length of service
rate Governance Code of the Bank. at the point of disengagement from the Bank and proper con-
duct at disengagement.
The Company Secretary and the Chief Compliance Officer for-
ward regular returns to the Central Bank of Nigeria on all whis- Internal Management Structure
tle-blowing reports and corporate governance breaches.
The Bank operates an internal management structure where all
officers are accountable for duties and responsibilities attached
to their respective offices and there are clearly defined and ac-
ceptable lines of authority and responsibility.

Whistle Blowing procedures

In line with the Bank’s commitment to instill the best corporate
governance practices, the Bank has established a whistle blow-

22 || 2019 Annual Report GUARANTY TRUST BANK PLC #EnrichingLives

SUBSIDIARY
GOVERNANCE

GUARANTY TRUST BANK PLC #EnrichingLives 2019 Annual Report || 23

SUBSIDIARY GOVERNANCE

Subsidiary governance tending existing credit facilities within a proposed aggregate
exposure limit defined by the Board of Directors.
Subsidiary governance is an integral part of our bank’s risk man-
agement framework that provides the structure through which • Board Asset and Liability Committee (BALC) oversees a vari-
the performance objectives of the subsidiaries are defined, mea-
sured and performance monitoring is conducted. ety of risks arising from the Subsidiaries’ business including
market and liquidity risk management, loan to deposit ratio
GTBank’s governance strategy is implemented through the es- analysis, cost of funds analysis, establishing guidelines for
tablishment of robust systems and processes – that ensure our pricing on deposit and credit facilities, exchange rate risks
subsidiaries reflect same values, ethics, processes and control as analysis, balance sheet structuring, regulatory considerations
the parent company, while remaining independent in the con- and monitoring of the status of implemented assets and lia-
duct of their business and abiding within the confines of local bility strategies.
extant regulations.
Furthermore, the Subsidiary Boards and their respective Com-
As at December 31, 2019, the Group had eight (8) international mittees are responsible for creating, evaluating and managing
banking subsidiaries and two (2) sub-subsidiaries. The operations the subsidiaries throughout their lifecycles while promoting best
and management of these subsidiaries are monitored and con- practice corporate governance standards.
trolled by GTBank Plc as described below:
Each of these Board Committees meet at least once per quarter
to review the affairs of the bank.

Oversight function

The International Banking Directorate is responsible for the coor-
dination and implementation of the Bank’s international expan-
sion strategy. It plays a pivotal role in driving and monitoring the
performance of existing subsidiaries. In this respect, it performs
an advisory role to the subsidiaries’ senior management and
serves as an interface between the parent and its subsidiaries,
while ensuring synergies between them.

Subsidiary Board Representation Representation on the Local Board and Board Com-
mittees
GTBank Plc has controlling representation on the Board of each
subsidiary. The Board representatives are seasoned professionals A minimum of two Non-executive directors representing GTBank
with high level of integrity and proven track records in their re- Plc sit on the board/board committees of the subsidiaries. The
spective fields. The Subsidiaries’ Board of Directors are responsi- Board Committees are responsible for defining capital structure,
ble for the governance of the Bank and accountable for creating approving appropriate risk management policies necessary for
and delivering sustainable value through the management of the the effective management of subsidiaries, providing advisory
Subsidiaries. and strategic guidance on the direction of the bank as well as
suitable technology required to effectively dominate the local
Subsidiary Board Committees markets.

The Subsidiaries’ Board also exercises its oversight responsibilities Management of Subsidiaries
through four major committees as follows:
The bank appoints one of its Management staff to run the sub-
• Board Audit Committee (BAC) reviews accounting policies, sidiary. This is achieved by appointing a staff from the parent
company to act as the Managing Director of the subsidiary. In
practices, procedures and controls established by manage-
ment for compliance with regulatory and financial reporting
requirements.

• Board Risk Management Committee (BRC) oversees and ad-

vises the Board on risk-related matters and risk governance.

• Board Credit Committee (BCC) exercises its responsibility to

maintain a healthy risk portfolio for the bank, by performing
the control actions of approving new credit facilities or ex-

24 || 2019 Annual Report GUARANTY TRUST BANK PLC #EnrichingLives

SUBSIDIARY GOVERNANCE

addition, another management staff is seconded to act as a conformity with credit policy, documentation check and review
backup to the Managing Director and Head of Support and Op- of central liability report among others.
erations Divisions within the bank.
Group Compliance Function
The objective is to ensure enculturation, adoption and continuity
of GTBank Plc values in the subsidiary. It is also to ensure that To ensure an effective and consistent compliance culture across
the tried and tested approach to corporate governance, systems all entities, the Group Compliance team determines the scope of
and controls, innovation and technology, credit approval and parental oversight required to manage compliance risk, promote
management processes likewise customer service excellence is awareness and implement industry best practices across our sub-
applied in a seamless manner. sidiaries, thereby affirming the group’s commitment to a zero
tolerance for regulatory breach.
Existence of Group Co-ordination Unit
Group Treasury Function
The business activities and performance of GTBank Subsidiar-
ies are monitored through the Group Co-ordination unit of the The Group Treasury function is responsible for providing required
International Banking Directorate of GTBank Plc. The Unit is guidance in optimizing the deployment of resources in the sub-
saddled with the responsibility of monitoring the subsidiaries, sidiaries except GTBank UK. The key focus is efficiency of the
providing necessary support and addressing issues arising from Balance Sheet. Monthly Assets and Liabilities review meetings
their activities. The unit also prepares monthly reports on the are held with the Group treasury team to create synergies and
performance of the subsidiaries and bi-annual risk management facilitate transfer of knowledge, skills and competencies. The
reports to the Board of Directors of the bank. The performance report is presented to the Board Assets and Liabilities or Risk
of the unit is assessed based on the extent to which the subsid- Committee where applicable.
iaries are effectively monitored and attended to.

Monthly Management Reporting Group Information Security Assurance

Subsidiaries furnish International Banking Directorate with re- The Group Information Security team is responsible for rendering
ports on their business activities and operating environment requisite guidance to subsidiaries on the security of their infor-
monthly. The reports cover the subsidiaries’ financial perfor- mation assets and infrastructure. They conduct regular off-site
mance, risk assessment, regulatory activities among others. and on site reviews of the adequacy of the existing information
security infrastructures in all the Subsidiaries. They also guide the
Business Performance Review Session subsidiaries on all cybersecurity related issues.

The Managing Directors of the respective GTBank Subsidiaries External Auditors’ Report
attend the quarterly Group Business Performance Review ses-
sions during which their performance is analyzed and recom- GTBank Plc conducts a review of the management letters pro-
mendations made towards achieving continuous stability and vided by the subsidiaries’ auditors on completion of periodic au-
improved profitability. This session also serves as a platform for dits. The objective is to ensure that all identified deficiencies are
sharing and dissemination of best practices and information promptly corrected and recommendations implemented in line
among the subsidiaries’ executives. with approved best practices and local regulatory guidelines.

Annual System and Control Audit

An annual audit is carried out by the system and control group of
GTBank Plc to review all operational areas of the offshore banks.
This exercise is distinct from the daily operations audit carried
out by the respective Internal Audit units within the subsidiaries.

Annual Risk Management Audit

This audit is carried out by the Credit Administration unit in GT-
Bank Plc. The areas of concentration during this audit include
asset quality, loan performance, review of security pledged, loan

GUARANTY TRUST BANK PLC #EnrichingLives 2019 Annual Report || 25

SUBSIDIARY GOVERNANCE

Guaranty Trust Bank Plc

International Banking
Directorate

Group Compliance Function GTBank Ghana Ltd GTBank Gambia Ltd GTBank Liberia Ltd
Enterprise Risk
98.32% 77.81% 99.43%
Management Function
Systems & GTBank Sierra GTBank Cote GTBank UK Ltd
Leone Ltd d’Ivoire Ltd
Control Function 100.00%
Treasury Function 83.74% 100.00%

Information GTBank Kenya Ltd GTBank Rwanda Ltd GTBank Uganda Ltd
Security Function
70.00% 67.20% 70.00%
Board Reporting Line
GTBank Tanzania Ltd

70.00%

26 || 2019 Annual Report GUARANTY TRUST BANK PLC #EnrichingLives

CORPORATE GOVERNANCE

SUSTAINABILITY
REPORT

GUARANTY TRUST BANK PLC #EnrichingLives 2019 Annual Report || 27

SUSTAINABILITY REPORT

Introduction and investments in critical sectors. The bank has also actively
involved itself in disbursing various intervention fund offered by
At Guaranty Trust Bank, we are aware that a strong Environmen- CBN towards growing some selected sectors in Nigeria.
tal, Social and Governance (ESG) proposition can safeguard our
long-term success. As such, we are committed to getting our The integration of Environmental & Social Risk Management
ESG proposition right in addition to the provision of economic (ESRM) framework into our credit approval process has helped
value. This is with a view to creating higher values in our busi- us to mitigate and prevent adverse E&S issues that may ema-
ness operation and activities. As part of our commitment, we nate from our borrowing customers. In 2019, we screened all
have fully incorporated environmental and social standards into the 886 corporate credits approved by the Bank for E&S risks.
our business operations and activities. This is in line with the We conducted enhanced due diligence for customers operating
requirements of IFC Performance Standards and CBN’s Nigerian in the high risk sectors as classified by the Central Bank of Ni-
Sustainable Banking Principles (NSBP). geria (CBN). We assessed all approved transactions for human
rights risks such as child labour and forced labour. Our assess-
We have integrated sustainability strategies into our business ment entails initial screening with the Exclusion Checklist for all
model based on our awareness of the link between strong fi- customers and Further Due Diligence Assessment for High Risk
nancial performance and sustainability. We have reviewed and customers or moderate due diligence for customers in Medium
updated the tools in which we manage our financial, social and Risk sectors.
environmental risks. We continue to improve our Environmental
& Social (E&S) processes to align with international best practice. As a leading financial institution, we remain committed to the
As an innovative and sustainable bank, we are constantly devis- provision of first-class financial products and services to our cus-
ing ways of doing things better. We learn from our past experi- tomers, including the underserved and unbanked population. In
ence and use our experience as a leverage to do things better. 2019, we deployed five (5) additional Agent Banking locations,
increasing the total number of locations to 60 across the nation
At GTBank, we support the government efforts at achieving from 55 that it was in 2018. Through these agent banking loca-
Sustainable Development Goals (SDGs) through our investments tions, we received deposits of about N6.5 Billion in 2019. This is
in critical sectors, our Corporate Social Responsibility (CSR) an increase of 85.7% from the last reporting period in December
and product development initiatives. We remain committed to 2018 (N3.5 Billion). We continue to partner with CBN SANEF
achieving the SDGs of the United Nations (UN) through the cre- programme to expand our reach to the unbanked.
ation of avenue for our communities and stakeholders to thrive.
We have continuously led across all key economic parameters in In order to further enhance our contribution to financial inclu-
the banking sector and have built a great brand in Africa. sion and women empowerment, we introduced “Quick Credit”
for Non-Salary Earners (NSE) in April 2019. As at the 31st of De-
We remain committed to the promotion of sustainable finance cember, 2019; about 9,539 NSEs are currently benefitting from
and meeting up with international standards. We are a mem- the loan with a total exposure of N1.73 Billion to the bank. This
ber of the United Nations Environment Programme Finance Ini- is in addition to other products that we have in place such as
tiatives (UNEP-FI) and an organisational stakeholder for Global food, fashion and quick credits which amount to N38.24 Billion
Reporting Initiative (GRI). Also, as a signatory to the Nigerian as at 31st of December, 2019. All these credits (including the
Sustainable Banking Principles (NSBP) of Central Bank of Nigeria quick credit for NSE) were granted at competitive interest rate
(CBN), we consistently meet all the required environmental and and without collateral.
social standards and ensure regular reporting of our sustainabil-
ity journey. As a sustainable bank, we continue to innovate and develop new
initiatives to create a better life for our customers. For instance, in
This 2019 Sustainability Report is a reflection of our journey over October 2019, the Bank removed all the bank charges for young
the last one year and it highlights various initiatives targeted at undergraduates (16-25 years) on our GTCrea8 Account product.
ensuring that we remain socially, environmentally and financial- With this, undergraduates will no longer pay charges on bank
ly responsible. The scope of our report covers the Marketplace, transfers, using 737, receiving transactions alerts, among others.
Community, Environment, Workplace as well as our scorecard in This is part of the Bank’s commitment in empowering the youth
the implementation of the Central Bank of Nigeria’s Sustainable through providing them the opportunity to bank for free.
Banking Principles and the UN SDGs.
As part of our quest to promote Small and Medium Enterprises
Market Place (SME), we partner with the Development Bank of Nigeria (DBN)
to disburse N25 billion to entrepreneurs in Nigeria’s Micro, Small
At GTBank, we continue to advance economic growth and sus- and Medium Enterprises (MSMEs) sector. This is the single largest
tainable development through our lending to the critical sectors disbursement by DBN to any financial institution in Nigeria. We
of the economy such as Manufacturing, Agriculture, Real Estate, continue to introduce various programmes and products to pro-
Power and Oil & Gas. We help support the government efforts mote Small and Medium Enterprises (SME), empower women
in achieving its diversification target through our active funding and deepen financial inclusion. For instance, the fourth edition
of both Food & Drink Fair, and Fashion Weekend in 2019 was

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SUSTAINABILITY REPORT

conducted as part of our drive to promote SMEs especially the ported NGOs to execute 20 projects in different parts of Nigeria
food and fashion industry. by providing funds totalling N20 Million.

The bank is consistently improving the features of Habari to sat- We had a programme in December 2019 that involved provision
isfy the needs of everyone. Habari is the first mobile platform to of fund for 100 people to travel home for Christmas celebra-
be developed by a financial institution in Nigeria for music and tion. We also provided them with gifts items for their loved ones.
video streaming, e-commerce and messaging. It is open and ac- We also organized an event called Xmas village for the orphans
cessible to everyone; meeting their lifestyles needs. Through our where we provided food to orphans from different orphanages,
USSD code, *737#, our customers in most remote locations are as a way of bringing smiles to their faces.
able to access financial services using their mobile phones.
In terms of promoting education, the Bank donated a sum of
Community One Hundred and Fifty Million Naira (N150,000,000) to 72 dif-
ferent students as scholarship contribution in 2019. We contin-
At GTBank, we consider Corporate Social Responsibility (CSR) to ue to organize a monthly reading event involving 200 students
be fundamental to our strategic objectives. Thus, we are com- to promote reading culture; trained 2,133 students on savings
mitted to lifting our communities and helping our stakeholders across 14 schools in 6 states in Nigeria during Financial Literacy
to flourish. As part of our commitment to enriching lives of the Day in March 2019, amongst others. In celebration of the World
host communities we operate in, we have a well-planned CSR Savings Day on October 31, 2019, some staff of the Bank vol-
strategy that stands on four pillars namely community develop- unteered to teach secondary school students on Saving Skills.
ment, education, environment and Arts. The essence of the trainings was to enhance financial knowledge
and improve saving culture among the youths.
In terms of community development, we carried out 106 proj-
ects in Nigeria, Ghana and Tanzania through our Social Responsi- In terms of protecting the environment, we continue to maintain
bility Challenge in 2019. The staff of 98 branches in Nigeria and our adopted public spaces in Lagos, Kano and Sokoto ensuring
two of our subsidiaries in Ghana and Tanzania participated in that the environment remains green and beautiful. This is in ad-
the challenge. This is a voluntary donation by our staff to touch dition to several initiatives introduced to protect the environment
the lives of people living in the communities where we operate. through our business operation and activities. The table below
Through our “Simple Change Big Impact programme”, we sup- highlights some of the CSR projects carried out by the Bank in
2019:

Area of Focus International Museum Day – an annual celebration to raise aware- Beneficiaries
Arts ness on the importance of museums. 549 students
Art 635 Virtual Reality Exhibition – A virtual experience and exhibi-
Education tion of artworks enlisted on Art 635 1,269 artworks exhibited on the virtual
Summer weekend – A free art class for children and students. reality space
Art Gallery – A free online Art Gallery created to support the arts 800+ children & students
in Africa. Artists signed up - 152; Artwork add-
GTBank Adopt-a-school project – The GTBank Adopt-a-school ed - 1358
project is a child focused programme introduced by the bank in Over 200 participants
2004, to improve the quality of public education available to the
Nigerian child. 200 participants/ monthly
Book N Guage/ Farafina Reads – A monthly Book reading event
promoting the reading culture. Over 200 visitors every week day

You Read Initiative – A public library to connect people with global 180 Children in attendance
resources of information and knowledge in Lagos, Nigeria.
Children’s Day Celebration (Books Rock) – in line with the You
Read Initiative, Books Rock was celebrated around children’s day
with events such as book reading, writing competitions, games
etc.

GUARANTY TRUST BANK PLC #EnrichingLives 2019 Annual Report || 29

SUSTAINABILITY REPORT

Mobile Library – A mobile library van with books for members of 1,000 participants

the community to exchange.

Dusty Manuscripts – an annual contest targeted at budding writers 1,300 entries received. 20 writers were

and providing the opportunity to win publishing deals for the shortlisted for boot camp.

finished but unpublished manuscripts

Healthcare Orange Ribbon Initiative – An annual autism conference and one- 2,000 conference attendance; 36,000

Sports/Youth Devel- on-one consultation sessions to educate and assist caregivers on online attendance.
opment
how to care for those living with the autism spectrum disorder.

Autism Focus Group Meeting – support for monthly focus group 45 participants per month.

meetings at Autism Resource Centre, Lagos University Teaching

Hospital (LUTH)

Orange Heart Initiative – staff donations towards sickle cell. 10 people with sickle cell received free

health care.

EDWIN – a support group for women living with disabilities 300 women.

Support for St Kizito Hospital – Donation of water plant to women Over 200 patients

living with HIV in the hospital

Christmas Party – support for children on admission at the Massey Over 200 children

Children Hospital, Lagos Island on Christmas Day

GTBank Masters Cup – An annual football tournament for private 1155 players, 28 schools

secondary schools in Lagos State.

GTBank Principals Cup – An annual football tournament for public 13068 players , 335 schools

secondary schools in Lagos and Ogun State

GTBank CARES – A sum of N55 Million was spent to acquire 488 488 persons

bicycle for distribution to children living in rural communities across

Nigeria. The aim is to leverage on the power of mobility through

bicycles to ensure that more children attend school and ultimately

break the cycle of poverty.

Environment Teller Machines (ATMs) and Communication devices powered by
solar panels. The number of our ATMs powered by alternative
As a sustainable bank, we continue to monitor our carbon foot- source of energy (Solar energy) also increased from 68 to 84
print through tracking of our electricity, fuel, water, solid waste from 2018 to 2019.
and paper usage. We consciously manage the impact of our
business operations on the environment by curtailing our busi- In terms of water usage, we were able to reduce our water us-
ness travels, ensure our generators are well-serviced and in cab- age by 18.4% from 2018 to 2019. This is an indication that our
ins, to prevent noise and fumes. We also ensure proper disposal water conservation technique such as avoiding water wastage,
of our wastes and efficient use of water. paying attention to leaking taps, among others, is working. The
total amount of solid waste generated by the bank increased
The electricity consumed from the National Grid decreased by by 7.7% from 2018 to 2019. We have developed strategies to
36% from 2018 to 2019 and this was as a result of adoption of reduce the quantity of our solid waste.
energy saving methods such as the use of energy saving bulb,
switching off all electrical appliances that is not in use, among Our paper usage increased by 6.7% because of the growing
others. Our diesel consumption also reduced by 11% from 2018 number of our staff both permanent and contract hires in 2019.
to 2019. The decrease in our fuel usage was as result of timely To address the increase in paper use, we have developed initia-
shut down of our branches. tives to reduce paper consumption especially among units with
the highest paper use. Some of the initiatives introduced to re-
The total number of our branches/business offices powered by duce paper consumption include the use of both sides of the pa-
alternative source of energy (solar energy) has increased by 13 per, the storing of documents digitally and electronically, being
(From 29 to 42) from 2018 to 2019. The Bank presently has 6 selective with what we print, the reuse of printed paper for jot-
Main Branches, 6 e-branches and 30 offsite locations which are ting, among others. As part of our strategy for paper reduction,
powered by a hybrid of solar and conventional energy supply 12% of the paper used by us were recycled instead of disposing
(Grid and Diesel Generators). These branches have Automated the paper immediately.

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The number of air travels increased by 13.4% from 2018 to with senior management staff to enhance interaction. Also, em-
2019. The Bank has developed initiatives to reduce travels (Air, ployees are able to express their opinion freely as they share the
land, etc) through the use of communication technology (Skype, same offices with senior management staff as part of the bank’s
Zoom) as substitute for physical meetings. There were no ad- Open Door Policy.
verse environmental impact reported on our branches or projects
financed in 2019. In line with our dedication to promote gender equality and em-
power women, the ratio of women in the employment of the
Workplace Bank and in senior management position is currently 46% and
37% respectively. In 2019, we maintained the number of wom-
At GTBank, we recognize the strategic importance of our work- en on our Board of Directors (BOD) at 4 (29%), same number
force in the achievement of our business objectives. As such, our as 2018. Furthermore, to celebrate International Women’s Day
focus is not restricted to the recruitment of qualified hands, but in March 2019, female employees were given special treatment
providing them the requisite trainings and conducive environ- and a seminar on a key topic affecting their productivity in the
ment to perform optimally in satisfying the needs of our cus- workplace was organized.
tomers. We identify the training needs of all our employees; and
offer competitive welfare package for effective service delivery. We had other initiatives for women such as Breast Cancer
Awareness Week, free treatment on fertility, session on “Ask
In 2019, the bank E&S Team trained seventy five (75) account a Gynecologist”, among others. The Breast Cancer week was
officers/relationship management team on Environmental and marked between October 14-18, 2019, where we invited a
Social Risk Management (ESRM). They also conducted a training breast cancer survivor to share her experience and sensitize our
on ESRM for all members of Enterprise Risk Management (ERM) female employees on how to do breast self-examination. We
division of the bank. We periodically publish on our intranet E&S also published on our intranet “ How to do a breast self-exam-
Learning Case Studies covering critical sectors of the economy. ination”. As part of the activities for marking the breast cancer
Our E&S team attended the workshop on ESMS implementation week, we introduced quiz on breast cancer awareness and offer
organized by IFC; and a 2-day sustainability summit to learn and prizes to the quiz winners. Our free fertility treatment was of-
share ideas on sustainability best practices with organisations fered to interested female staff.
from different sectors in Nigeria.
The bank has diversity policy as part of its Employee Handbook.
For our entire staff, we provided training on subject matters The bank does not discriminate in its recruitment process. The
ranging from Corporate Governance, Enterprise Risk Manage- bank has a well-articulated Bribery and Corruption policy, money
ment, Environmental and Social Risk Management, Leadership laundering policy and whistle-blower programs that were draft-
and Management, among others. We continue to provide our ed in line with best practices and also vetted by the regulators.
employees with weekly awareness on health related issues and The bank does not prevent staff from joining an association.
personal finance through “Wellness Wednesdays” and “Finance Employees are encouraged to join social association with the
Fridays” published on our intranet. In March 2019, we had sec- subscription fees paid by the bank. The bank is a role model
ond season of our Orange League Football Competition. The in the market place for conducting its business transparently as
football competition has helped to promote friendly competi- embedded in our core principles- the Orange Rules.
tion among our various business lines. A week-long Health Week
which ended with our annual Staff Trek and Family Fun day was We deployed on our website a portal for addressing complaints
also organized by our staff Engagement Team. and enquiries by our customers. We won several awards in 2019
such as Best Bank in Nigeria, Best CSR Bank in Nigeria, Best Retail
The bank has acquired several certifications that show com- Bank in Nigeria, Best Customer Experience, among others. These
pliance to international best practices such as ISO 9001:2015 awards are evidence of our outstanding performance as a Bank
(Quality Management System), ISO 27001 (Information Secu- in 2019.
rity Management), ISO 20000 (Information Technology Service
Management), ISO 22301 (Business Continuity Management), Progress on CBN’s Nigerian Sustainable Banking Principles
among others. The bank has also implemented Health and Safe- (NSBP)
ty Management System in line with ISO 45001:2018.
The bank is a signatory to the CBN’s Nigerian Sustainable Bank-
The bank has grievance mechanism in place to address employ- ing Principles (NSBP). The CBN’s NSBP aligns with relevant inter-
ees’ complaints. The bank HR team conducts survey on a regular national standards. We ensure that our business activities and
basis to elicit the views of employees on critical issues that may operations are in tandem with the provisions of the nine (9)
affect them, and provide platform for the management to re- principles of NSBP. The table below highlights some of our key
solve the issues. Besides conducting surveys, other initiatives in achievements in the implementation of CBN’s NSBP for 2019:
place to get the opinions or suggestions of employees include:
Call the MD session, regular town hall meetings, yearly Retreat
by the bank where selected members of junior staff are mixed

GUARANTY TRUST BANK PLC #EnrichingLives 2019 Annual Report || 31

SUSTAINABILITY REPORT

NSBP PRINCIPLES DEFINITION PROGRESS UPDATE
Principle 1
Our Business Activities: • In 2019, we screened all our transactions for E&S risks
Environmental & Social Risk
Management. Integration • As at December 31, 2019 we have visited/conducted desktop Due
of environmental and social Diligence Assessments for 87 customers whose operations fall under
consideration into our lending high risk. Based on the review of relevant documents and information
activities. provided by the client, we came up with action plans to be closed out by
the customers.

Principle 2 Our Business Operations: Envi- • In 2019, our paper consumption increased by 6.7%. As such we have
ronmental & Social Footprint. developed initiatives to reduce paper usage especially with the units with
Avoidance of the negative the highest use.
impact of our Business Oper-
ations. • The electricity consumed from the National Grid decreased by 36% from
2018 to 2019 and this was as a result of adoption of energy saving meth-
ods such as the use of energy saving bulbs, putting off of all electrical
appliances that is not in use, among others. Our diesel consumption also
reduced by 11% from 2018 to 2019.

• We presently have 6 Main Branches, 6 e-branches and 30 offsite locations
which are powered by a hybrid of solar and conventional energy supply
(Grid and Diesel Generators), while 8 ATMs are powered by hybrid energy
(blend of solar and conventional power sources).

Principle 3 Human Rights: Respect for • A total number of 886 Transactions booked were assessed for human
the rights of all in Business rights risks such as child labour and forced labour in 2019. Assessment
Operations. comprised of initial screening with the Exclusion Checklist for all custom-
ers and Further Due Diligence Assessment for High Risk customers.

• We did not process any transaction with counterparties where human
rights violation/abuse were identified.

Principle 4 Women’s Economic Empow- • The percentage of female employees against the total staff complement
erment: promote economic remains at 46%.
empowerment through a
gender inclusive workplace • The percentage of women in management position increased from 35%
culture and provide products in 2018 to 37% in 2019.
and services for women.
• The number of women on our board remained four (4 women), same as
2018.

• The bank has products such as Food, Fashion and Quick credits that are
women focused and they could apply without collateral.

Principle 5 Financial Inclusion: Promotion • In 2019, the bank opened an additional 5 Agent Banking locations in
of financial inclusion and pro- Lagos, Rivers and Oyo states.
vision of financial services to
individuals and communities • The Bank hosted the GTBank Food and Drink Fair to support SME busi-
that have limited or no access nesses in the food industry. The event was attended by over 250,000
to the formal financial sector. individuals and provided vendors the opportunity to promote their food
products and services.

• The number of our branches that can easily be accessed by physically
challenged increased from 116 to 118 from December 2018 to Decem-
ber 2019. All new branches are provided with ramps for easy access and
dedicated toilets were also provided for physically challenged.

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Principle 6 E&S Governance: Implemen- • Our internal audit team (Syscon) conducts monthly visits to track and
Principle 7 tation of a transparent E&S monitor our progress on E&S governance
Principle 8 governance practices within
Principle 9 the institution and assess the • We provided update to our investors (IFC, Proparco and AfDB) on our E&S
E&S governance of our clients. performance

• We do monthly and quarterly reports to our management and board on
our E&S journey

Capacity Building: develop- • The bank E&S team trained 75 account officers/relationship managers on
ment of capacity to identify, Environmental and Social Risk Management (ESRM).
assess and manage E&S risks
and opportunities associated • We conducted a training on ESRM for all members of Enterprise Risk
with the bank’s business activi- Management (ERM) division.
ties and operations
• We published on the intranet E&S Learning Case Studies.

Collaborative Partnerships: • We attended a 2-day sustainability summit for organisations in different
collaboration across the sector sectors in Nigeria to learn and share best practices in Sustainability.
and leveraging on interna-
tional partnerships and move • Held E&S process review meetings with IFC
the financial sector as one • We attended the workshop on ESMS implementation organized by IFC
and ensure consistency with
international standards. • The bank rendered the Bi-Annual Sustainability Report to the regulator
(CBN) and also dedicated a chapter on the Bank’s sustainability journey in
Reporting: regularly review the financials.
and report our progress in
meeting the principles/

• We also provided periodic updates to our investors such as IFC on the
integration of Environmental and Social Risk Management (ESRM) in the
Bank’s framework.

The United Nations Sustainable Development Goals (SDGs)

At GTBank, we support the government efforts at achieving Sustainable Development Goals (SDGs) through investments in critical
sectors, our CSR and product development initiatives. Our achievements in terms of promoting SDGs are highlighted below:

GOAL TARGET We contributed to poverty reduction through periodic payment of taxes to
Goal 1: No Poverty government, introduction of accessible credits for low-income people such as
Eradicate extreme poverty for Quick credit for Non-Salary Earners (NSE), through our various CSR initiatives
all people everywhere such as provision of scholarship to indigent students, among others.

Goal 2- Zero End hunger, achieve food We contribute to ensure hunger eradication through strategic lending to cus-
Hunger security, improved nutrition tomers in the agriculture sector such as Presco, Olam, WACOT, among others
and promote sustainable and various initiatives such as yearly food & drink fair which has helped to
agriculture. promote SMEs in the food industry and increase access to cheap and afford-
able food, thereby reducing hunger. We also provided single digit interest
rate credit facilities to participants in the food industries.

Goal 3- Good Ensure healthy lives and We continue to promote healthy living through our various health initiatives
Health and Well- promote well-being for all at such as donations to patients with sickle cells and women living with HIV,
being all ages support for children with Autism, support for patients at St Kizito Hospital,
visit to Massey Children Hospital and gift donations, among others.

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SUSTAINABILITY REPORT

Goal 4- Quality Ensure inclusive and equitable At the core of our CSR is education, this is based on our awareness that ed-
Education quality education and promote ucation has multiplier effects in terms of reducing poverty, improving health
lifelong learning opportunities and contributing to economic growth. We promote education through our
for all various initiatives such as adopt a school programme, donation of reading
materials to schools, renovation of schools, Mobile Library, GTcr8 Scholarship,
Orange Cycles/GT cares where bicycles were procured for students in remote
villages to ease their daily commute, among others.

Goal 5- Gender Achieve gender equality and At GTBank, we support gender equality through our HR policies and various
Equality empower all women and girls initiatives carried out by the Bank. As at the 31st of December, 2019, the
percentage of women in our workforce is 46% while that of senior manage-
ment team is 37%.

In 2019, we organized Food & Drink fair, and Fashion Weekend and offer
food and fashion credits to promote businesses in the food and fashion space
mostly dominated by women.

Goal 6- Clean Wa- Ensure availability and sustain- In 2019, we promoted sustainable management of water and sanitation
ter and Sanitation able management of water through our employees volunteer activities such as repair of a non-functional
and sanitation for all borehole at Ja’oji, Zaria Road, Kano; donation of toiletries at ST Vincent de
Paul Centre, Umuafai, Abia State and the Nigerian Prison Service at Segede,
Ondo State; renovation of 6 toilets and repair of faulty pumping machine at
Federal Housing Estate Primary School, Lagos State; environmental exercise
participation by sweeping and cleaning of Idumota Market, Lagos and that
of Ugbo Awa Community in Enugu State; among others.

Goal 7- Affordable Ensure access to affordable, We have made significant internal and external contribution in ensuring ef-
and Clean Energy reliable, sustainable and mod- ficient energy usage and encouraging our borrowing customers towards the
ern energy for all adoption of renewable energy. We have 42 of our branches and 84 of our
ATMs powered by solar energy. We continue to reduce our diesel consump-
tion and introduce energy saving light bulbs at all our branches in order to
reduce energy consumption and ensure a safer environment.

Goal 8- Decent Promote sustained, inclusive At GTBank, we ensure that we promote sustainable economic growth and
Work and Econom- and sustainable economic decent work through paying competitive wages to our staff. We offer several
ic Growth growth, full and productive benefits such as 13th month salary, HMOs, pension, leave allowance, quar-
employment and decent work terly allowance, half-year bonus, among others, to promote decent living for
for all our employees. We engaged vendors through competitive bids for projects
and services.
Goal 9- Industry, Build resilient infrastructure,
Innovation and promote inclusive and sus- In 2019, we partnered with the Development Bank of Nigeria (DBN) to pro-
Infrastructure tainable industrialization and vide loans totalling N25 Billion to Micro, Small and Medium Enterprises (MS-
foster innovation MEs) as a way of promoting economic growth.

In 2019, GTBank built Nigeria’s first digital play centre for children. This is one
of our own ways of promoting innovation by providing a place for kids to
have fun while engaging in an experience that can add to their mental and
intellectual development. We provided ramps and ensured the installation of
energy efficient electrical bulbs in all our new branches in 2019.

We remain committed to using our value-adding banking products and ser-
vices to improve the condition of Nigeria’s social infrastructure.

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Goal 10- Reduced Reduce inequality within and In 2019, we embarked on several projects aimed at reducing inequalities and
Inequalities among countries providing a level-playing field for everyone. Through our staff social responsi-
bility challenge, we were able to empower over 1000 people living with dis-
Goal 11- Sustain- abilities. For instance, the staff of our Garki Area 3 branch donated crutches,
able Cities and protective sandals and toiletries to 100 persons living with leprosy at Yangoji
Communities community in Abuja.

Goal 12- Responsi- Make cities and human settle- At GTBank, we continue to ensure that we make our cities safe and habitable
ble Consumption ments inclusive, safe, resilient for everyone through financing projects that allow for the creation of smart
and sustainable city and donations towards a cleaner and habitable city. For instance, our
Goal 13- Climate staff in Ogui road branch in Enugu State participated in cleaning drainages at
Action Ugbo Oye at Abakpa Nike, Enugu State.

Ensure sustainable consump- In 2019, GTBank embarked on several initiatives that helped in efficient us-
tion and production patterns age of energy thereby reducing our energy cost. Some of these initiatives in-
clude printing on both sides of the paper, timely shut down of our branches,
switching off all electrical appliances not in use, reducing car emissions from
multiple cars by engaging in car pooling, segregation of wastes into reusable,
recyclable and non-reusable, among others.

Take urgent action to combat At GTBank, we continue to minimize the impact of climate change in our
climate change and its impacts business activities and operations. We conduct enhanced due diligence for
customers whose activities may impact negatively on the environment (High
Risk sectors). We also conduct moderate due diligence for customers in me-
dium risk sectors. This is with a view to minimizing the effects of climate
change in the operations of our customers.

Goal 14- Life below Conserve and sustainably use As an organisation, we developed several initiatives to reduce our carbon
water the oceans, seas and marine footprint such as water, fuel and electricity usage in 2019.
resources for sustainable
development Through our sustainable waste management practices, we partnered with
Lagos State Waste Management Authority (LAWMA) and other government
Goal 15- Life on Protect, restore and promote approved waste collectors to ensure that all wastes from our facilities are
Land sustainable use of terrestrial disposed only in designated landfill sites. Through the use of government
ecosystems, sustainably man- approved waste collectors, waste generated from our branches is prevented
Goal 16- Peace, age forests, combat deserti- from ending up inside the ocean or river to disrupt marine life.
Justice and Strong fication, and halt and reverse
Institutions land degradation and halt At GTBank, we are conscious of the need to protect life on land through
biodiversity loss our sustainable waste management and deliberate attempt at reducing the
number of solid wastes sent to landfill sites in order to reduce land pollution.
Promote peaceful and inclu- Our awareness of the link between paper use and deforestation made us to
sive societies for sustainable develop some initiatives to moderate our paper usage in 2019.
development, provide access
to justice for all and build At GTBank, we have a well-organized governance system that is highly trans-
effective, accountable and in- parent and accountable to all our stakeholders. Ours is an organisation that
clusive institutions at all levels has been able to promote peaceful co-existence in our communities of oper-
ations through our CSR activities.

In 2019, through our staff voluntary social responsibility challenge, we were
able to execute 106 projects in some communities in Nigeria, Ghana and
Tanzania.

GUARANTY TRUST BANK PLC #EnrichingLives 2019 Annual Report || 35

SUSTAINABILITY REPORT

Goal 17- Partner- Strengthen the means of In our attempt at promoting the UN SDGs, we were able to form partnership
ships for the goals implementation and revitalize with Several organisations as well as other global bodies. Some of these or-
the global partnership for ganisations are listed below:
sustainable development
• Member, United Nations Environment Programme Finance Initiative (UN-

EP-FI)

• Organisational Stakeholder, Global Reporting Initiatives (GRI)
• Member, Nigerian Sustainable Banking Principles
• Development Partner, Central Bank of Nigeria (CBN)
• Development Partner, International Finance Corporation (IFC)
• Development Partner, African Development Bank (AfDB)
• Development Partner, Development Bank of Nigeria (DBN)

Summary of our ESG Materiality • Lifecycle impacts of products and services: At GTBank, we
are aware of the importance of conducting due diligence on
At GTBank, we are concerned with the development of innova- our products and services. We have an Environmental and
tive approach to meet the needs of all our stakeholders. We con- Social Policy endorsed by the regulators and approved by
duct stakeholders’ analysis and developed strategy to connect the board. The policy is developed in line with the require-
with our stakeholders. ments of CBN’s NSBP and international best practices such
as the IFC Performance Standards. We have fully integrated
Using the guidance of the Sustainability Accounting Standards environmental and social considerations into all our business
Board (SASB) developed in 2018, we summarize our material activities and operations. We conduct enhanced due dili-
ESG issues below: gence for customers in high risk sectors and moderate due
diligence for customers in medium risk sectors. As part of our
• Access and affordability: At GTBank, we are concerned with assessment, we apply the bank’s exclusion list on all credits.
increasing access to our services and creating affordable ser- We monitor the action plans developed through our due dil-
vices. In 2019, we introduced quick credit for Non-Salary igence and ensure that identified gaps are closed out by our
Earners (NSEs), removed charges for our GTCrea8 Account customers.
product, improved the features of Habari to satisfy the needs
of everyone, partnered with DBN to promote MSMEs, among • Business ethics: The Bank has a strong business ethics and
others. We were able to increase our customer base through promotes its core values to employees of the Bank through
our deliberate efforts in promoting community development, its Code of Professional Conduct; its Ethics Policy as well as
business growth and financial inclusion. Communications Policy, which regulate employee relations
with internal and external parties. This is a strong indicator of
• Labour practices: At GTBank, we are aware of the impor- the Bank’s determination to ensure that its employees remain
tance of our workforce in achieving our strategic business professional at all times in their business practices. The Bank
objective of attracting more customers and increasing our also has an entrenched culture of openness in which healthy
deposit base. We continue to provide requisite trainings and discourse is encouraged and employees are mandated to re-
offer competitive welfare package to all our workforce. This port improper activities in the Bank.
is to enhance quality of service from our employees to our
customers. • Systemic risk management: We have a strong Enterprise Risk
Management division that works with relevant units in the
• Data security and customer privacy: We are aware of the im- bank in managing risks in our business operations and that
portance of data security to our continued existence, as such, of our business activities. We have several risk management
we have a robust legacy banking application and technolo- units that see to different kind of risks such as credit, opera-
gy architecture that prevent data leakages and compromise. tional, reputational, market, legal, cyber risks, among others.
We have in place sophisticated tools to prevent cyber-attacks
and promote data security. We also ensure customer priva-
cy by aligning with best international practice. We comply
with the requirements of General Data Protection Regula-
tion (GDPR) and that of Nigeria Data Protection Regulation
(NDPR) and other relevant regulations. We constantly create
awareness to our staff, customers and vendors to be aware
of the activities of fraudsters and the need to preserve their
security details from identity theft.

36 || 2019 Annual Report GUARANTY TRUST BANK PLC #EnrichingLives

COMPLAINTS
AND
FEEDBACK

GUARANTY TRUST BANK PLC #EnrichingLives 2019 Annual Report || 37

COMPLAINTS AND FEEDBACK

Introduction Complaints Handling and Resolution Structure

At Guaranty Trust Bank plc (“the Bank”), we understand the The Bank has an effective mechanism in place for complaints
importance of our customers’ satisfaction to the achievement handling which ensures the prompt resolution of customers’
of our set goals. Hence, the incorporation of the ‘treating cus- complaints if and when they arise. The Complaints Unit of the
tomers fairly’ principles into our business strategy to enable us Bank is charged with the responsibility for receipt, prompt inves-
deliver on our promises to our stakeholders. tigation and resolution of customers’ complaints. It also serves
as the liaison between the Bank and its customers as well as
We recognize that customer feedback is an important tool in regulatory authorities.
monitoring and responding to customer expectations hence we
continue to imbibe good conduct practice across our business, Complaints received are given a unique identifier number for
with a range of initiatives to further improve the service and ex- tracking purposes, acknowledged and addressed promptly.
perience we offer to customers. Where a resolution can be provided immediately, the customer is
provided with feedback, if not, the issue raised is referred to the
The information gathered is used for detailed analysis to identify appropriate team in the Bank for prompt resolution. The custom-
recurring issues which are reviewed by the relevant stakeholders er is kept informed throughout the process until final feedback is
for learning purposes and improvement of the Bank’s products provided and resolution attained. The complaint is then marked
and services with emphasis on preventing a reoccurrence of such as closed.
identified issues.
The complaints handling process is reviewed periodically and
The Feedback Channels/ Customer Touch points complaints received are categorised and reviewed properly with
the aim of enhancing the Bank’s delivery of efficient and effec-
We appreciate the feedback provided by our customers, as such tive services.
the following touch points are available to encourage our cus-
tomers’ interaction with the Bank: The Bank ensures that complaints are dealt with in an equitable,
objective and unbiased manner. We also align our procedures
• GT Connect (our 24 hours self-service interactive call center); with regulatory requirements and international best practice in
• The Complaints received via emails, letters and the portal on a bid to ensure that the complaint handling process is fair and
reasonable.
the Bank’s website;
Reports To The CBN On Customer Complaints
• Social Media feedback platform;
• The Customer Information Service desk at any of our branch- In line with the Central Bank of Nigeria (CBN) guidelines on res-
olution of customers’ complaints, the Bank provides periodic re-
es; ports to the CBN.

• The Whistle Blowing portal on the Bank’s website. Below is a breakdown of Complaints received and resolved by
the Bank between January and December 2019 pursuant to CBN
Customers’ opinion on products, services and circular dated August 16, 2011.

processes

The Bank constantly evaluates valuable insights provided by cus-
tomers and other stakeholders regarding our products, services
and policies in order to improve the business and overall custom-
er experience.

The review and evaluation are conducted using various methods
including:

• Customer feedback survey via the Bank’s website, In-branch,

and Internet banking customer satisfaction rater;

• One-on-one focus/business review meetings with customers;
• Business review sessions/ Interviews with randomly picked

customers.

• Our ‘Call the MD’ sessions

38 || 2019 Annual Report GUARANTY TRUST BANK PLC #EnrichingLives

COMPLAINTS AND FEEDBACK

Description Number Amount Claimed Amount Refunded
(N’000) (N’000)

2019 2018 2019 2018 2019 2018

1 Pending Complaints brought 87 106 329,014 853,165 --
forward from prior year

2 Received Complaints 49,553 45,737 173,026 700,092 - -
49,587 45,756 173,282 1,224,243 282,014 326,328
3 Resolved Complaints

4 Unresolved Complaints escalated -- -- --
to CBN for intervention

5 Unresolved Complaints pending 53 87 328,758 329,014 --
with the Bank carried forward *

* Some of the outstanding complaints include complaints on dispense errors on other Bank terminal, failed bill payment, excess charges, etc.
In addition to the above, the Bank made additional refund of N153,757,000 during the year.

The table below show Complaints received and resolved by the Bank in other currencies for the year ended December 2019 and
December 2018 respectively.

RECEIVED COMPLAINTS (Per Currency) 2019 Amount Claimed
Currency $44,476
2018
1 United States Dollars �570 $1,835,818
2 Great Britain Pounds €6,359
3 Euros �0
€9

RESOLVED COMPLAINTS (Per Currency)

Currency Amount Claimed Amount Refunded

1 United States Dollars 2019 2018 2019 2018
2 Great Britain Pounds
3 Euros $44,476 $1,835,818 $13,109 $1,829,139

�570 �0 �0 �0

€6,359 €9 €4,265 €0

In addition to the above, the Bank made additional refund of $1,676 during the year.

UNRESOLVED COMPLAINTS (Per Currency) Amount Claimed
Currency
2019 2018
1 United States Dollars $0 $0
2 Great Britain Pounds �0 �0
3 Euros €0 €0

REPORTS TO THE CBN ON FRAUD AND FORGERIES

In line with Section 5.1.2 (L) of the CBN Code of Corporate governance, the breakdown of fraud and forgeries for the year is provid-
ed below:

Fraud and Forgeries 2019 2018

Number of Fraud Incidents 15,461 10,673
Amount Involved (N'000) 1,535,564.23 821,432.28
Amount Involved (USD$'000)
Actual/Expected Loss (N'000) 139.17 79.99
Actual/Expected Loss (USD$'000) 107,445.50 157,077.87

0.91 27.28

GUARANTY TRUST BANK PLC #EnrichingLives 2019 Annual Report || 39

AML/CFT
FRAMEWORK

40 || 2019 Annual Report GUARANTY TRUST BANK PLC #EnrichingLives

AML/CFT FRAMEWORK

Anti-Money Laundering and Combating the Financ- ensures that the Bank’s Management and all employees adhere
ing of Terrorism (AML/CFT) framework strictly to all regulatory and internal procedures relating to AML/
CFT and that the Bank maintains a zero tolerance for regulatory
Guaranty Trust Bank plc (“The Bank”), remains committed to the infractions.
fight against all forms of financial crime, which includes, mon-
ey laundering and terrorist financing, bribery and corruption. To (ii) Reports to Senior Management and the
show this commitment, the Bank has implemented a framework Board:
for Anti-Money Laundering (“AML”), Combating the Financing
of Terrorism (“CFT”) and the prevention of the financing and On a monthly and quarterly basis, AML/CFT reports are provided
proliferation of weapons of mass destruction. It is also manda- to senior management and the Board respectively. These reports
tory for all members of staff Group wide to ensure strict compli- provide the Board and senior management with information to
ance with the framework to protect the global financial services enable them to evaluate the Bank’s compliance with its regulato-
industry. ry obligations. The reports also ensure that Directors and senior
management are kept well-informed of emerging trends and
The Bank’s framework ensures compliance with AML/CFT legis- developments in the financial industry, particularly in the area of
lation and regulations in Nigeria and has incorporated leading AML/CFT risk management.
best practices. The bedrock of the framework incudes, but is not
limited to the following: Feedback on the reports are provided to the Compliance team by
the Board as part of its oversight function.
• The Financial Action Task Force (FATF) 40 Recommendations;
(iii) Know Your Customer (KYC) procedures:
• Money Laundering (Prohibition) Act 2011 (as amended);
To ensure that only customers that align with the Bank’s risk
• Terrorism (Prevention) Act 2011 (as amended); appetite are on-boarded, a duly completed account opening
form and the provision of identification and other relevant in-
• CBN AML/CFT Regulations 2013; formation and documents are provided. This is the foundation/
bedrock for on-boarding a customer in the Bank. Customer Due
• Terrorism Prevention Regulations 2013; Diligence (CDD) and AML/CFT risk assessment is conducted be-
fore engaging in any banking relationship with a customer. This
• Corrupt Practices and Other Related Offences Act, Cap. C31 includes at a minimum, identity, biometric verification number
Laws of the Federation of Nigeria, 2004 (“the Act”). (BVN) and address verification as well as ascertaining the source
of income and wealth of the customer. Where appropriate, KYC
• UK Bribery Act 2010; includes ascertaining who the Ultimate Beneficial Owner (UBO),
Legal representatives and Trustees are for the account.
• USA Foreign Corrupt Practices Act;
Customers that are identified as high risk from the AML risk as-
• Central Bank of Nigeria (CBN) Circulars. sessment are subjected to Enhanced Due Diligence (EDD). EDD is
conducted on such customers including Politically Exposed Per-
Structure of the framework sons (PEPs) to assess and manage the risks that the customers
might pose. The approval of senior management and the Com-
The Bank has developed policies and procedural guidelines, pliance team is required prior to the commencement of banking
and these documents are regularly reviewed/revised to ensure relationship with such high-risk customers.
that they stay relevant and current and are in line with the ev-
er-changing regulatory requirements and leading practices. The In compliance with regulatory requirements and perceived AML
Policies and Procedures clearly lay out the Bank’s AML/CFT stance risk threats, Designated Non-Financial Businesses and Profession-
in the global fight against financial crime and are available on als (DNFBPs) and other similar businesses are required to under-
the Bank’s intranet for access to all members of staff at any point take requisite and regulatory measures before account opening.
in time. The AML/CFT statement is also available on the Bank’s
website. As part of the Bank’s KYC and CDD procedures, identification
documents are requested and obtained to confirm the ultimate
The Bank has advanced from a basic “rule based and tick box” beneficial owners of a business and the organisation’s control
approach for combating financial crime risk, to a risk-based and structure. Sanction screening is also conducted prior to en-
approach. Thus, the Bank identifies, classifies and assesses the tering into a relationship as well as prior to effecting a transac-
risks from a proactive position and assigns the requisite resourc- tion to ensure that the Bank does not enter into a relationship
es which revolve around systems and controls to manage these with a sanctioned person/entity.
risks. The risk-based approach better equips the Bank to handle
emerging risks. (iv) Transaction Monitoring:

Scope of the framework Transaction monitoring is done using manual and automated
methods. The former is performed by all members of staff, who
The scope of the Bank’s AML/CFT framework includes the fol- are regularly provided with red flags to look out for and the latter
lowing: resides within the Compliance team with the aid of transaction
monitoring solutions.
(i) Board and Management responsibilities:

In accordance with AML/CFT global best practice, the “tone is
set from the top”. The Board of Directors of the Bank has over-
sight responsibilities for the AML/CFT framework. The Board

GUARANTY TRUST BANK PLC #EnrichingLives 2019 Annual Report || 41

AML/CFT FRAMEWORK

All members of staff are aware and are constantly reminded of organisations who have or plan to enter a business relationship
the fact that suspicious activities/ transactions should immediate- or carry out a transaction with/through the Bank against the
ly be referred to the Compliance team. Bank’s internal watch list.

To properly monitor transactions passing through the Bank’s sys- The internal watch list contains amongst others, the names of
tems, the SAS AML tool, has been fully deployed in the Bank, individuals and entities, who have been blacklisted by various
providing an advancement in the means by which transactions bodies worldwide: Office of Foreign Asset Control (OFAC); Euro-
are monitored and investigated. pean Union (EU); Her Majesty’s Treasury (HMT); The Ministry of
Economy, Finance and Industry in France (MINEFI); The United
(v) Transaction Reporting: Nations (UN); and the Local Lists as provided by local regulatory
and enforcement bodies.
Regulatory and statutory requirements stipulate that certain re-
ports and returns are made to regulatory bodies. The Nigerian Employees are required, as part of the Bank's policy, to refrain
Financial Intelligence Unit (NFIU) is the agency charged with the from any relationship and/or transaction which yield a true or
responsibility in Nigeria of receiving these transaction reports. positive match. Where a true positive match is identified, staff
are to follow the escalation procedure. The Bank employs an
The following are the transaction-based reports sent to the NFIU automated tool to aid in the screening against sanctions lists.
in accordance with statutory and regulatory requirements: Sanctions screening is done at account opening, as well as on
a periodic basis for all accounts, and on a real time basis for all
• Currency Transaction Report (CTR) SWIFT transactions.
• Foreign Currency Transaction Report (FTR)
• Suspicious Transaction Report (STR) (viii) Politically Exposed Persons (PEPs)

The Bank renders reports to the NFIU and the Central Bank of PEPs are individuals who are or have been entrusted with promi-
Nigeria (CBN) in accordance with the provisions of sections 2, 6 nent public functions and the classification also includes, people
and 10 of the Money Laundering (Prohibition) Act of 2011 as or entities associated with them. Enhanced due diligence mea-
amended (“the Act”). sures are applied to PEPs, as with other high risk customers to
mitigate the AML/CFT risk they pose. This is to ensure that the
Section 2 of the Act provides that financial institutions must sub- Bank is not unintentionally aiding fraudulent activities such as
mit a report on all international transfer of funds and securities money laundering and/or the financing of terrorism.
of a sum exceeding ten thousand dollars ($10,000) or its equiv-
alent in other foreign currencies. In line with FATF's recommendation, the Bank employs the use
of an automated monitoring tool in identifying and monitoring
Section 6 of the Act provides that a financial institution must PEP transactions. This is attained through the thorough review of
submit a report on all unusual suspicious transactions. information provided by customers and their transaction trends.
Continuous monitoring is also carried out on these accounts.
Section 10 of the Act provides that any lodgment or transfer of
funds in excess of N5 million and above for individuals and N10 On-boarding of new PEP accounts, as well as continuity of such
million and above for corporate customers must be reported. accounts (for those already existing in the system) is subject to
the approval of an Executive Director and the Compliance Team.
The Bank also, where applicable, in accordance with the Act,
provides transaction-based reports to competent authorities as (ix) AML/CFT principles for Correspondent
required. Banking:

(vi) Relationship with Regulators and Law The Bank only on-boards and maintains correspondent banking
Enforcement Agencies: relationships with financial institutions that have implemented
adequate AML/CFT policies and procedures. The Bank does not
The Bank maintains a cordial and supportive relationship with all enter into any form of relationships with shell banks nor main-
regulatory and law enforcement agencies. The Bank promptly tain any payable through accounts. The Bank ensures that due
complies with and responds to all requests made, pursuant to diligence, including adverse media searches, are performed an-
the law, and provides information to regulators including the nually on our correspondent relationships to mitigate potential
NFIU, the CBN and other relevant agencies. AML/CFT risks.

The Bank is also at the forefront of cooperating with regulators (x) Prohibited Business Relationships:
to give feedback on new regulations and means to mitigate the
risks that are being encountered in the financial industry brought In line with international best practice, the Bank does not open
on by new innovations and developing trends. accounts or conduct transactions for customers using pseud-
onyms or numbers instead of actual names. The Bank also does
(vii) Sanctions Compliance Management: not maintain relationships with individuals or entities that have
been sanctioned. This includes not entering business relation-
As a policy, the Bank does not enter any relationship with sanc- ships with individuals on the BVN Watchlist without the express
tioned individuals/entities. All employees, as applicable to their approval of the CBN.
functions, are required to screen names of individuals and

42 || 2019 Annual Report GUARANTY TRUST BANK PLC #EnrichingLives

AML/CFT FRAMEWORK

(xi) Risk Assessment: (xv) Record Retention:

The Bank conducts Risk Assessment on its customers, existing In accordance with regulations, customer identification docu-
products, new products and services. This is to ensure that AML/ ments are retained throughout the life of the account and for
CFT risks are identified, assessed and mitigated. Customer ac- five (5) years after the cessation of the banking relationship.
counts are also reassessed periodically to ensure that risk posed Transaction instruments are retained for five (5) years after the
by customers are adequately identified and mitigated. transaction date.

A report in accordance with local regulation and best practice is In litigation and/or regulatory investigations, the records will be
prepared annually. kept for as long as they are required.

(xii) Anti-Bribery and Corruption (ABC) (xvi) Subsidiaries
and Anti-Fraud):
In compliance with international best practice, the Bank ensures
The Bank upholds the highest standards of ethical conducts in that its subsidiaries AML/CFT provisions are consistent with the
all its activities and interactions. The Bank has zero tolerance for Bank’s framework. These measures are applied to the extent
any form of bribery, corruption, fraud and unethical practices that the respective subsidiary’s local laws and regulations permit;
among employees, between the Bank and its employees, as well however, where there is a variance the stricter regulation will
as between the Bank and external parties. The Bank also man- always apply.
dates the same standards to be applied by third parties acting on
behalf of the Bank. Greater collaboration has been fostered and control measures
taken based on the current international best practices. This is
The Bank’s Board approved Ethics policy provides the requisite to ensure that all our subsidiaries maintain the highest standards
standards and principles on ethical conducts and practices ex- for AML/CFT controls.
pected and required of all staff and our related stakeholders.

(xiii) AML/CFT Training:

The Bank places a lot of importance on the training of its em-
ployees. Training is conducted to ensure employees are well in-
formed and up to date on the AML/CFT laws, KYC principles and
the red flags of money laundering or terrorism financing which
may occur in their job functions. Annual Compliance training is
mandatory for the Board members and all levels of staff, includ-
ing Senior Management.

Trainings is conducted via e-learning, face to face or on an ad
hoc basis by email or via intranet slides to the appropriate per-
sonnel in relation to topical national and international findings.

Tests are also conducted annually after the trainings to ensure
that all staff have understood the training content.

(xiv) AML/CFT Audits:

To ensure compliance with laws and regulations and to ensure
an ever-evolving fit for use of the Compliance function, internal
audit of the AML/CFT function is conducted on a quarterly basis.
The audit is done to test the adequacy of the AML/CFT functions
and ensure that the AML/CFT measures put in place by the Bank
are up to date and effective.

The reports and findings of the audit are circulated to various
levels of senior management. A follow-up to the audits takes
place to ensure that the relevant issues are closed out and that
the highlighted recommendations have been implemented.

The Compliance function also undergoes an annual independent
audit by an external consultant in accordance with regulatory
requirements.

GUARANTY TRUST BANK PLC #EnrichingLives 2019 Annual Report || 43

INTERNAL
CONTROL AND
RISK
MANAGEMENT
SYSTEMS

44 || 2019 Annual Report GUARANTY TRUST BANK PLC #EnrichingLives

INTERNAL CONTROL AND RISK MANAGEMENT SYSTEMS

Internal control and Risk Management Systems in re- ing. Management Committees meets on a regular basis to assess
lation to the financial reporting the credit, market, interest rates, liquidity, legal and reputational
risks facing the bank. Senior Management also regularly consid-
Guaranty Trust Bank’s internal control and risk Management ers whether the existing internal controls are effective in relation
systems ensure that material errors or inconsistencies in the fi- to the risks identified in the financial reporting process.
nancial statements are identified and corrected. The Bank’s in-
ternal control framework is patterned after the Committee of The Board also assesses the effectiveness of the Bank’s internal
Sponsoring Organisations of the Treadway Commission’s (COSO) control over financial reporting on an ongoing basis and specifi-
Framework. cally at mid-year and year end. The Management letter issued by
the external auditors which contains the auditors’ observations
COSO defines internal control as “a process effected by an on the control environment in the Bank is discussed at the Audit
entity’s Board of Directors, Management and other personnel, Committee meetings.
to provide reasonable assurance regarding the achievement of
objectives” in three categories--effectiveness and efficiency of Periodic Independent Assessment of the Internal Au-
operations; reliability of financial reporting; and compliance with dit Function
applicable laws and regulations. The scope of internal control
therefore extends to policies, plans, procedures, processes, sys- In line with the Nigerian Code of Corporate Governance, banks
tems, activities, functions, projects, initiatives, and endeavors of are to undergo an independent Quality Assurance Review (QAR)
all types at all levels of the Bank. of their Internal Audit function. The objective of this review is to
assess the Internal Audit function’s conformance to regulatory
The internal control and risk Management systems comprise the standards and requirements, as well as to identify improvement
following areas: opportunities. One of such reviews was recently concluded in
the bank and going forward, it will be conducted periodically as
• Control Environment mandated by the Code.
• Risk Assessment
• Control Activities Control Activities
• Information and Communication
• Monitoring Control activities are an integral part of the Bank’s day to day
operations. Senior Management has set up control structure to
Control Environment ensure control activities are defined at every business area.

The Bank has three Board Committees (Board Risk Committee, Examples of the Bank’s control activities include the following;
Board Credit Committee and Board Audit Committee) that have
oversight function on the Bank’s Risk Management Processes. Top Management Reviews
The Committees are responsible for setting risk Management
policies that ensure material risks inherent in the Bank’s business • Internal Audit Reports eliciting control weaknesses are pre-
are identified and mitigated or controlled. The Bank also has
an Audit Committee which is made up of three shareholders’ sented periodically to Management and Board Audit Com-
representatives and three Non- Executive Directors; one of the mittee.
shareholders’ representatives is the Chairman. The Audit Com-
mittee is therefore independent. Its oversight functions include • Preparation of financial statements on a daily basis for Man-
among others, ensuring that quality accounting policies, inter-
nal controls, independent and objective statutory auditors are in agement review.
place to prevent and detect fraud and material errors in financial
reporting. • Monthly and quarterly profitability review, where the Bank’s

The Bank’s Management committees are responsible for imple- financial performance is reviewed and compared with set
menting risk Management policies set out by the Board. They are budgets. Quarterly reports of the Chief Risk Officer to the
also responsible for setting internal control policies and monitor- Board, eliciting the existing and potential risks facing the
ing the effectiveness of the internal control systems. They ensure Bank and the mitigants deployed.
proper books of accounts are kept and accounting policies are
in conformity with: International Financial Reporting Standards; Activity Control
Prudential Guidelines for licensed Banks; Circulars issued by the
Central Bank of Nigeria; The requirements of the Banks and Oth- Control functions are embedded within each business area for
er Financial Institutions Act; and The requirements of the Com- self-checking of activities within the areas (for instance, transac-
panies and Allied Matters Act. tions call over for timely detection of errors is carried out by all
posting units).
Risk Assessment

The Board and Senior Management regularly assess the risks the
Bank is exposed to, including risks relating to financial report-

GUARANTY TRUST BANK PLC #EnrichingLives 2019 Annual Report || 45

INTERNAL CONTROL AND RISK MANAGEMENT SYSTEMS

Physical Controls Information and Communication/ Monitoring
There are policies guiding access to the Bank’s physical and fi-
nancial assets, including dual custody, use of overrides etc. The Bank’s Management understands the need for a timely, reli-
Compliance with Limits able and accurate information flow within the Bank, for effective
The Bank sets internal limits guiding its trading book activities, decision making and enhanced financial reporting. Every activity
liquidity and interest rate gaps, credit concentration limits. The of the Bank is codified in the Bank’s standard operating proce-
limits are monitored on a daily basis by an independent unit out- dure (SOP), which outlines the process flow and specifies the
side the business areas. duties and responsibilities of every officer in relation to the ac-
tivity. The SOP further highlights requirement for reporting, the
Approval and Authorisation Limits frequency of reporting as well as those within the organisation
to whom the report would be directed to.
• There are segregation of duties; no officer can start and con-
The following are some of the generic internal reports used by
clude transactions Management for decision making and monitoring purposes:

• Limits exist for credit and expense approvals. Transactions are • FINSTAT- Financial Statements Report
• BPR- Business Performance Review Report
approved at appropriate levels. • MPR- Monthly Profitability Report
• Liquidity Ratio Report
Verifications and Reconciliations • OPR - Operations Performance Report
All internal ledgers are regularly proofed and reconciled; excep- • APR- Account Profitability Report
tion reports are generated. • ECR- Expense Control Report
• CAC- Criticized Asset Committee Report
Whistle Blowing • CLR- Criticized Loans Report
The Bank has instituted a strong whistle blowing culture among • ALCO- Asset and Liability Committee Report
staff and also created awareness among its stakeholders. The • Overdraft Efficiency Report
whistle blowing platform is accessible to all and the aim is pri-
marily to ensure that all cases of irregularities are made known
and addressed by the Bank.

46 || 2019 Annual Report GUARANTY TRUST BANK PLC #EnrichingLives

CHAIRMAN’S
STATEMENT

GUARANTY TRUST BANK PLC #EnrichingLives 2019 Annual Report || 47

MRS. OSARETIN DEMUREN

48 || 2019 Annual Report GUARANTY TRUST BANK PLC #EnrichingLives