As Access Bank prepares for its Rights Issues expected to yield N68 billion, the lender has continued to highlight key attributes of the offer in favour of existing shareholders, saying it makes the offer irresistible to investors, report SIMEON EBULU and COLLINS NWEZE.
Savvy investors know where to put their money. As Access Bank Nigeria Plc prepares to give investors fresh opportunity to invest in it. Many investors with eyes on good returns on their investment know that it is an opportunity they cannot afford to miss, said the bank’s Deputy Group Managing Director, Obinna Nwosu.
He said the lender will be raising N68 billion capital through Rights Issues. He advised shareholders to take up their rights when the issue begins, as the bank has proven its ability to deliver superior returns on investment.
The bank chief also listed some of the major attributes that makes Access Bank an institution of choice for investors.
Strengths
Nwosu said the bank has Capital Adequacy Ratio of 21 per cent, and has seven banking subsidiaries. The lender also employs 3,192 professional staff working in 366 branches. The lender has 1,042 ATMs, with 11,846 Point of Sale channels.
He said with a vision of becoming one of the most respected banks in Africa, Access Bank has grown to be the top five banks in Nigeria, stating that between 2002 and 2007, the bank ranked among the top 10 lenders in the country. “That feat was triggered by its role as a dominant trade finance bank; top three foreign exchange and money market bank and model of compliance in the banking industry,” he said.
Nwosu, who spoke in company of other Senior officials of the bank, including the Executive Director, Commercial Banking, Roosevelt Ogbonna at a media briefing in Lagos, said that between 2007 and 2012, the bank emerged among the top five in the financial services group, adding that this was achieved based on its reference point of Service Delivery; leading e-business support bank; employee of choice in Africa; reference point for corporate governance; attainment of high independent credit rating and as a top five trade finance lender.
Looking ahead, he said the lender has a vision that by 2017, it would become the most respected African Bank. “To attain this, the lender wants to achieve the top three position by all financial metrics; become a reference point for technology; sustain high independent agency; become a leading project and structured finance bank, as well as best treasury and financial market bank in the country,” he said.
Reasons to Invest in
Access Bank
On his part, Ogbonna said that investors should consider the fact that Access Bank is a Tier-1 Bank with Robust financial indicators, Enlarged resource base with strong upside potentials, credible leadership with a clear focus on value creation for shareholders and strong returns for investors.
He listed Capital appreciation & dividend payout, attractive market price trading at a 0.9 times its discount book value, strong corporate governance, shareholder management practices and window of opportunity in rapidly expanding and consolidating banking sector, as other enticing indicators.
He also said that the bank has demonstrated capacity in integrating and extracting value from acquisitions, has actively traded stock with a robust shareholder base and a track record of strong performance; kept every promise made since 2002.
He said Nigeria continues to be a compelling story with significant growth opportunity. Access Bank is fully embedded as a Nigerian Tier-1 Bank and completed our transition to a large diversified financial institution.
“Also, enhancement of Tier 1 capital is imperative to enable us exploit the market opportunities and achieve our vision, whilst delivering superior shareholder value,” he said, adding that the bank is poised to building and leveraging on resources and benefits of being a large diversified financial institution.
Where to invest the fund
The bank’s Chief Financial Officer (CFO), Seyi Kumapayi, said the lender will deploy the N68 billion on its working capital to boost lending and support Information Technology (IT) upgrade.
The CFO said part of the funds will also be deployed on branch expansion, renovation and facility upgrade, as well as replacement of obsolete equipment.
He said Nigeria with 170 million people, enjoys stable political and economic environment as well as excellent demographics, thus making the business environment exciting. He said the lender has overtime, consistently delivered superior returns to its shareholders.
“We have shown that we can integrate and add value to institutions based on our successful acquisition of Intercontinental Bank,” he said.
Kumapayi said the lender has Asset Management Corporation of Nigeria (AMCON) bonds worth N65 billion, which will mature and be retired this month.
He described Access Bank as a Tier 1 bank with robust financial indicators, enlarged resource base, with strong upside potentials, credible leadership with a clear focus on value creation for shareholders.
The bank, he added, also enjoys strong returns for investors –capital appreciation and dividend payout. The bank is listed on the Nigerian Stock Exchange and London Stock Exchange.
On timing for the Rights Issue, the CFO said the timing is right. He said shareholders have been contacted and they approved the time frame for the Rights Issue. “Our shareholders have approved the Rights Issue. We have been on it for a long time during which we engaged both local and international investors,” he said.
Shareholders
The bank’s shareholders are expected to vote on October 13 on the proposal to sell shares to existing investors. Banks are preparing to sell equity and debt after the Central Bank of Nigeria (CBN) changed the way lenders calculate capital buffers.
The CBN is seeking to increase banks’ ability to withstand losses five years after the AMCON bought bad debts from banks to save the industry from collapse.
The regulator removed some assets lenders can count as capital in preparation for the implementation of Basel II and III, while limiting Tier 2 capital to 33 per cent of higher-quality Tier 1 capital, according to an August 5 circular.
The lender announced in April that it has received shareholders’ approval to raise $1 billion, including through debt and equity to fund lending targeted to rise to 20 per cent this year.
Sustainable banking
Access Bank is also a strong converser for the implementation of sustainable banking principles by lenders.
Its Chief Risk Officer, Dr. Gregory Ovie Jobome recently called on stakeholders in the Nigeria Sustainable Banking Principles (NSBP) to follow uniform reporting standards for them to achieve the desired objective.
Speaking at the NSBP Pre-Reporting Workshop held in Lagos, he said stakeholders needed to ensure that they formulate policies that will enable them achieve their sustainable banking objectives. The workshop was organised by Access Bank.
He said operators needed to ensure that issues around human rights, environmental sectors to the bank and other critical issues are reported uniformly.
The Managing Director of Sustainable Finance Limited, Carey Bohjanen, said banks should think through the NSBP and implement them. She said the NSBP is a regulatory requirement that lenders have to adhere to because it is also cost-saving.
She said in line with global trends on sustainability, the CBN, on March 6, issued the NSBPs reporting template to banks, discount houses and development finance institutions for compliance.
The purpose of the reporting template, she added, is to provide reporting institutions with a uniform format for reporting their implementation efforts.
To successfully implement the guidelines, she said, it is necessary for reporting institutions to have an implementation plan with realistic timelines, stressing that all hands must be on deck to ensure successful implementation of the NSBPs.
She said the reporting template developed by the CBN will encourage consistency in reporting by banks, discount houses and development finance institutions, as well as provide the CBN with a standard for assessing the commitment of reporting institutions to implementing the principles and sector guidelines.
The CBN expects that these policies and procedures would have been ratified by the bank’s Board of Directors and exposed to management staff and subsequently, to all staff of respective institutions.
Innovation
Access Bank Plc and Visa recently announced a partnership with an online shipping company, shoptomydoor.com to give the lender’s Visa cardholders to shop online at retailers in the United States, United Kingdom and China. The cardholders also by this partnership, enjoy exclusive shipping discounts.
Also, cardholders will have the opportunity to shop from the world’s major international retailers with more flexibility and convenience. They can make purchases online in these countries as if they are local residents and also have them shipped in a few business days.
The bank said the deal shows its commitment to the Central Bank of Nigeria’s (CBN) cash-less banking and enhancing electronic payments, e-commerce and ease of transactions.
The bank’s Executive Director, Personal Banking, Victor Etuokwu, said the introduction of Shoptomydoor.com platform is a deliberate attempt by the lender to make financial services easy and accessible to its customers.
Its Head, Card Products, Justin Ijeh, expressed the lender’s commitment to providing innovative products, and not just aimed at aligning with the CBN’s cash-less policy, but also designed to make life easier for its customers.
“While the surge in e-commerce has given rise to concerns about online security, the bank has allayed the fears of its customers by confirming that its cards are protected with top-notch security tools. In addition to the in-built security mechanism, Access Bank’s Visa Cards are protected and verified by VISA features,” he said.
