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Nedbank Swaziland Limited has given its employees shares worth approximately E3.3 million. The total number of shares is 2 650 000 ordinary shares in the issued share capital of the company. This follows the approval of the proposal made by the Board of Directors of introducing an Employee Share Ownership Programme that involves the creation of the Sinakekelwe Broad Based Scheme and Management Scheme, the Sinakekelwe Long Term Incentive Scheme and the Employee Share Ownership Trust, which are all collectively referred to as ‘transactions’. The board sought the approval of the scheme from shareholders ahead of the Extraordinary General Meeting (EGM) that was scheduled for November last year. According to documents in possession of this newspaper it was recommended that 2 650 000 shares are allocated under the ‘transactions’, which in turn, would enable Nedbank Swaziland Limited employees to control 10 per cent of the company.

Shareholders of the bank include Nedbank Limited, the Swaziland government and other shareholders. “In line with the Nedbank Group’s strategic objective of empowering its staff members across the Group, your Board of Directors is proposing to introduce an Employee Share Ownership Programme which will involve the creation of the Sinakekelwe Broad Based Scheme and Management Scheme, the Sinakekelwe Long Term Incentive Scheme and the Employee Share Ownership Trust. The Board believes that the company’s employees will be incentivised and in the process create shareholder value. More importantly, the proposed ‘transactions’ will strengthen the alignment of employee interest to that of shareholders. This is also in line with market practice,” partly reads the letter written by the Nedbank Swaziland Limited Chairman, Mabili Dlamini.

Quality

It says the Employee Share Ownership Programme was proposed on the fact that it would enable the bank to attract and retain quality staff, the programme would result in an alignment of both the shareholders’ and employees’ interests, as well as the fact that the scheme was in line with governments’ and the banks’ strategic objective of having empowerment schemes. “The proposed share ownership programme will place the business in a better position to attract, reward and retain critical staff. Further, it will enable Nedbank to remain market competitive and be a credible employer with considerations of equity. In addition, the alignment of shareholders and employees’ interests will also be greatly enhanced, which in turn, will drive the banks’ future performance,” reads the letter in part.

It further says; “Your Board consider the ‘transactions’ to be in the best interest of both Nedbank and Nedbank shareholders. Your directors therefore unanimously recommend that you vote and approve the resolutions contained in the Notice, as they intend doing so in respect of their beneficially held shares in the issued share capital of Nedbank.” When reached for comment on the resolution taken at the EGM last year concerning the proposal, Nedbank Swaziland Limited Managing Director Ambrose Dlamini confirmed that shareholders approved the proposal during the meeting in November. “This means that qualifying employees will become shareholders in Nedbank Swaziland Limited,” he said. Asked if this meant that all Nedbank employees would automatically have shares, Dlamini answered to the negative.

“No. Only Swazi citizens who are permanently employed by Nedbank Swaziland) Limited are eligible. This includes employees who are employed by Nedbank Swaziland Limited, who may be temporarily seconded to work elsewhere in the world. The trustees may also determine eligibility from time to time as agreed by the Remunerations Committee. All eligible employees must be in service on November 30, 2009 and not under separation on the date of grant, to qualify for the allocation,” he explained.