Governance Policies

The Bank has provided guides/policies for managing (1) Conflict of Interest, (2) Related Party Transactions, and (3) Insider Trading incidents.

The incidents cover situations in which personal, occupational or financial considerations may affect, or appear to affect a third party, director, senior management, or other staff's objectivity or ability to act in the best interests of the Bank and its stakeholders.

These policies are to be read in conjunction with all subsisting laws, legislations, and regulations (as amended), including the Banks and Other Financial Institutions Act (BOFIA), 2020, Central Bank of Nigeria (CBN) Act, 2007, Nigeria Deposit Insurance Corporation (NDIC) Act, 2023, and Companies and Allied Matters Act (CAMA), 2020, Nigerian Code of Corporate Governance (NCCG), 2018, CBN Corporate Governance Guidelines For Commercial, Merchant, Non-Interest And Payment Service Banks in Nigeria, 2023, amongst others.

Conflict of interest is any activity that is inconsistent with or opposed to the Bank's best interest or that gives the appearance of impropriety or divided loyalty.

Directors, senior management, and other staff must avoid any relationship or activity that might impair, or appear to impair, their ability to make objective and fair decisions when performing their function. When faced with situations where business decisions conflict with their own personal or family interests, they must declare such through the processes established by the Bank.

It is the duty of the Directors, senior management, and other staff to disclose any actual, potential, or perceived Conflict of Interest in the course of their responsibilities as they arise in accordance with the guiding policies. The Company Secretariat and Compliance Department are responsible for maintaining the Conflict-of-Interest Registers for directors and employees, respectively.

A related party is a party that:

(i) directly, or indirectly through one or more intermediaries:

• controls, is controlled by, or is under common control with the Bank (this includes parents, subsidiaries and fellow subsidiaries)
• has an interest in Quest Merchant Bank that gives it significant influence over the Bank; or
• has joint control over the Bank

• (ii) is an associate of the Bank.
• (iii) is a joint venture in which Quest Merchant Bank is a venture.
• (iv) is a member of the key management personnel of the Bank or its parent;
• (v) is a close member of the family of any individual referred to in (iv), subject to the definition provided in BOFIA above;
• (vi) is an entity that is controlled, jointly controlled or significantly influenced by, or for which significant voting power in such entity resides with, directly or indirectly, any individual referred to in (iv) or (v); or
• (vii) is in a post-employment benefit plan for the benefit of employee.

A related-party transaction refers to a deal or arrangement made between two parties who are joined by a preexisting business or social relationship or common interest that may create a conflict of interest.

Insider transactions can occur as follows:

(A) Insider trading: When material non-public information from a Bank is used to make a trading decision by Director management or other staff with an invested interest. The Bank prohibits insider trading activities.

(B) Credit Related: When approving exposures to insiders, necessary due diligence shall be taken to ensure that Quest Merchant Bank's interest is not compromised, and its risk acceptance criteria are not sacrificed.

Due diligence in the identification and reporting of insider and insider-related credits shall not be compromised, and the general level of awareness across Quest Merchant Bank shall be elevated through:

• Sensitization of relationship managers to obtain relevant insider-related information from clients at the point of credit origination.
• Obtaining information on directors/significant shareholders and their related interests through the Company Secretary.

All identified insider-related credit shall only be processed with the concurrence of the related insider.