The Nation Newspaper

Tag: Performance

  • ‘Corporate governance key to good performance’

    ‘Corporate governance key to good performance’

    Managing Director, FBN Merchant Bank Limited, Mr. Kayode Akinkugbe, has underscored the importance of sound corporate governance as a cornerstone for good and sustainable corporate performance in the banking sector.

    He said sound corporate governance must go beyond compliance and check-lists; it must become a way of life and all stakeholders have the duty to ensure that sound corporate governance permeates the length and breadth of Nigerian banks.

    Akinkugbe, who delivered a keynote speech at the monthly meeting of the Committee of Chief Compliance Officers of Banks in Nigeria (CCCOBIN), noted that the principles of corporate governance must form the basic framework for ensuring that stakeholders are able to enjoy long term benefits and value from banks.

    He added that sound corporate governance also serves as strong pillars that ensure overall market confidence in institutions.

    According to him, the institution of corporate governance, backed by legislative, economic and financial reforms intended to promote transparency, accountability and the rule of law in the economic life of the country, are critical in assuring the banking public retains trust and confidence in such essential of bodies.

    He pointed out that good corporate governance not only ensures compliance with legal and ethical standards, but helps in building the strength of financial institutions within an economy.

    He noted that in recent years, corporate governance has attracted considerable interest, particularly following the global financial crisis and other corporate scandals, which have led to the promulgation of rules and directives aimed at creating strong internal systems and controls that are comparable for financial institutions across the globe.

    “We are proud to be part of a larger Group, FBN Holdings Plc,  which has a strong heritage of promoting corporate governance practices that have resulted into over 120 years of uninterrupted service and continued growth,” Akinkugbe said.

    He restated the commitment of FBN Merchant Bank towards maintaining a strong posture on sound practices.

    He urged all chief compliance officers to engage, review and update policies and procedures to meet evolving business needs, and ensure familiarisation amongst all stakeholders, noting that this is critical to ensuring that the goal of running sustainable banking institutions is achieved.

  • Wema Bank optimistic on future performance

    Wema Bank optimistic on future performance

    Wema Bank has assured shareholders and other stakeholders that ongoing strategic initiatives would strengthen the resilience of the bank against the macroeconomic and industry headwinds and lead to improved performance in the years ahead.

    At the annual general meeting yesterday in Lagos, managing director, Wema Bank Plc, Mr. Segun Oloketuyi, said the board and management of the bank remain committed to positioning the bank for sustained growth.

    He noted that in spite of the challenging outlook for 2016, the bank has started the year with a renewed focus on its strategic aspiration of becoming a leading retail bank in Nigeria.

    He pointed out that the performance of the bank during the 2015 business year has demonstrated its resilience and commitment to continuously deliver value to the stakeholders even in the face of obvious challenges.

    “The continued implementation of Project LEAP, the bank’s growth strategy, narrowed our focus and channeled our efforts towards specific opportunities with great potential and symbiotic relationships. This strategy, in its final phase, will continue to guide the bank’s allocation of resources in 2016,” Oloketuyi said.

    He commended the shareholders for their supports, which have continued to encourage the management noting that the bank attained many feats in 2015 including the granting of a national banking license to the bank by the Central Bank of Nigeria (CBN).

    According to him, the 2015 financial year was a particularly challenging one for the banking sector and economy as a whole due to the impact of reduced government spending, policy changes in foreign exchange administration, a depressed energy sector, declining manufacturing outputs and elements of insecurity, which have continued to take a toll on consumer spending and economic activities.

    He noted that despite these challenges the bank was able to sustain its transformation drive with total deposits for the period growing about 10 per cent over the prior year to N284.9 billion, gross earnings improving to N46.0 billion from N42.19 billion recorded in 2014, and profit before tax remaining stable at N3.05 billion compared to N3.09bn in 2014.

    Wema Bank grew its top-line by a modest 6.1 per cent to N11.3 billion in the first quarter as the commercial bank continued to grow its retail business in spite of the tough operating environment.

    Interim report and accounts of Wema Bank Plc for the three-month period ended March 31, 2016 indicated that gross earnings improved to N11.3 billion in first quarter 2016 as against N10.6 billion recorded in comparable period of 2015. Profit before tax stood at N505.33 million in 2016 as against N615.29 million in 2015. After taxes, net profit stood at N429.53 million as against N522.99 million. Earnings per share closed first quarter 2016 at 4.0 kobo compared with 5.0 kobo in first quarter 2015.

  • Dwindling allocation hampers SMEDAN’s performance, says DG

    Dwindling allocation hampers SMEDAN’s performance, says DG

    The Director-General/Chief Executive Officer (CEO), Small and Medium Enterprises Development Agency (SMEDAN), Dr. Umaru Dikko Radda, has said dwindling statutory allocations have affected the agency’s capacity to reach out to the Medium, Small and Micro Enterprises (MSMEs).

    Radda spoke in Kaduna at the strategic management retreat for the agency’s senior officers.

    He said statistics showed that Nigerian and New Zealand SMEs contribute the highest to employment. Nigerian SMEs, he said, had the lowest contribution to the Gross Domestic Product (GDP), while Brazilian SMEs have the highest contribution to GDP because their agency is well funded.

    Radda said: “While our counterpart in Brazil gets $1.8 billion subvention yearly, SMEDAN’s allocations in 2014 and 2015 were $20.1 million. While our counterpart in the United States (US) oversees 20 million SMEs, SMEDAN oversees about 37 million MSMEs.

    “Ironically, our US counterpart’s subvention in 2016 is $701.3 million, which is more than the budget of SMEDAN since inception in 2003. Radda, therefore, stressed that basically the retreat was, among others, to provide a platform for the review of the agency’s operations and strategically chart the way forward.

    ”The retreat is further aimed at aligning the operations of the agency to the fundamental goal of President Muhammadu Buhari’s government, which is revamping the productive and service sectors of the economy with a view to diversification from the oil sector and creating mass job opportunities,” he explained.

    Earlier in her speech to declare the retreat open, the Minister of State for Industry, Trade and Investment, Hajiya Aisha Abubakar, expressed satisfaction with Radda’s effort at re-positioning the agency.

    She assured that the special needs of MSMEs would need to be attended to enable new and existing businesses thrive and provide job opportunities for over 70 million youths.

  • TG/PS: film shows’ll boost performance

    Tutor General/Permanent Secretary (TG/PS), Education District I, Lagos State, Dr Olufolayinka Ayandele, is expecting SS3 pupils that will take Literature in English in the ongoing May/June 2016 West African Senior School Certificate Examination (WASSCE) to pass with flying colours.

    This expectation is as a result of extra efforts employed to prepare the about 4,000 candidates attending over 100 public secondary schools under the district for the examination.

    The district collaborated with Viewpoint Educational Services to organise film shows that covered all the literary texts in the WASSCE Syllabus.

    Though Viewpoint Educational Services wrote to all the six education districts in Lagos State to take advantage of the film shows as an instructional media to help their pupils, Mrs Sidikat Abiola, its CEO, said only Education District I responded.

    Dr Ayandele said she jumped at the offer because she had seen its effectiveness in another district prior to taking up her current assignment.

    “I was the Director, Schools Administration in education District III.  What we did then was to do the film show not only in one point but we went closer to the students so that the distance covered by them to the venue would be very short.  We saw the impact because the children came out with good results in Literature. So on assumption duty here, I needed to ensure that I kept the tempo. So I was able to key in because I have experienced it before and I am a witness to that kind of methodology,” she said.

    In between the various films, Dr Ayandele said the pupils got opportunity to ask questions, and were exposed to techniques for answering various questions in the examination.

    “We were able to identify students with 80 percent and above in Literature, with good conduct.  Then we attached them to 20 students that were below 55 percent. So before the film show they came together.  But that day was like a grand finale.  After each film show, we broke and then asked questions, and corrected them.  We also brought in their Literature teachers so after the external examiner spoke to them, they met with their literature teachers for another one hour before they left for the day,” she said.

    In future, Dr Ayandele said film shows would incorporate other subjects as well, not just Literature because it is a fun method of learning.  She is also confident that the introduction of other innovations, like team teaching, which makes it easier to manage large classrooms, a feature in many schools in the district, would help as well.

    “You know children love watching films so we are using that method to attract them.  What children see, what they can feel and what they can discuss retain better in their memory.  It will be a major feature of our methodology in this district. We will be doing a lot of film shows even in mathematics and biology,” she said.

    Attesting to the efficacy of film show as an instructional media, Mrs Abiola said as an expert, she can use resources within the environment to promote learning.

    “I am a specialist.  I specialise in educational media and it involves anything at all that is a medium that you can use to pass information from the source to the receiver. It is anything that appeals to your hearing, smelling, tasting, in short the five senses.  So, if you students are not doing well in mathematics, after teaching them orally, we can put the concepts on posters or show films, or turn it into a game,” she said.

     

  • Revenue collections and Disco’s performance

    Two years after the privatization, the country is still battling with same power supply problem . This calls for serious concern on why the situation has not changed even after privatization. Many are quick to question the integrity of the private operators and blame the Distribution Companies (Discos) for not improving power supply, some blame the generation companies while others blame it on the transmission which is still a government-owned entity.

    Before one can go deep into the problem, a brief overview of the privatization will give a useful insight to where the country is now in addressing the power supply issue.

    First the unbundling of the sector and subsequent privatization as provided in the EPSR Act 2005 was to improve performance and ensure transparency in the activities of the unbundled entities, the generation, transmission and distribution, and to attract  participation of the private sector in the provision of power in the country.

    The unbundled entities, comprising of six generation companies, and 11 distribution companies were privatized while Federal Government retained the Transmission Company as state owned. Government also retained 40% interest in  the distribution companies,  while the private sector is holding 60%. Also in the privatization of generation companies,   government retained 20%, leaving 80% to the private sector.

    This shareholding structure shows that the private sector is not the sole owners of the power sector as the public assumed.  This shareholding structure imposed limitations on the operators of the sector. This is because the private operators who are the core investors are restricted in the utilization of the assets of the companies in raising  the needed finances to invest in improving the inherited dilapidated assets.

    The EPSR Act also empowered the regulator, the Nigerian Electricity Regulatory Commission (NERC) to regulate the activities of the operators including fixing of cost recovery tariff for the utilities. The regulator  by the Act is supposed to be independent, protecting the interest of both the public and the private operators. The independence of the regulators is also important such that any sign of compromise can affect the effective operations of the private operator as the electricity market is very sensitive to the regulations.

    Privatization normally has two major objectives, it is either output focus that is improving the quality of supply or additional investment in the sector.

    In Nigeria, the focus was more on additional investment instead of quality of service; the Request for Proposal emphasized the financial worth of the bidders which resulted in selection of the highest bidders based on how much naira they bidded. Hundreds of billions of naira were realized from the deal. Unfortunately in the whole transaction , the participants were local companies who through the local commercial banks were able to acquire the utilities, no foreign investor with proven technical experience participated due to lack of confidence in privatization  process.

    They could not risk their long terms funds in uncertain environment, despite the road shows all over the world. The local companies were left to mobilize short term funds from local banks to finance the acquisition of these assets, overstretching the capacity of the local banks who are now putting pressure on the core investors to service their obligations. This has actually put the investors in a financial trouble between servicing the loans and providing the funds to effectively operate the facilities they acquire to provide quality supply of electricity to the public not to talk of any hope of getting returns yet for its investment.

    The problem is particularly worse with the Discos who are most exposed to the public in the chain of electric sector. The Discos are the ones to be blamed anytime there is power cut, anytime there is low voltage, anytime there is tariff increase, anytime there is problem with power supply like the recent national blackout on March 31, between the hours of 12:35 and 15:00, the country’s power system crashed to zero MW due to system collapse that was linked to the tripping of a transmission line and poor gas supply.  It is important to note that the  transmission which is  government owned  is the weakest link in the chain of power supply that need serious investment to enable it evacuate power generated by the Gencos to the Discos effectively.

    In the course of the privatization, there were series of agreements that were signed between BPE (Bureau of Public Enterprises ) representing government and the operators with specific obligations to the parties involved to guide effective performance of the agreements as Public-private partnership. These obligations  include the following:

    *Proper gas supply policy at the time of privatization.  *Cost reflective tariff to operate optimally. The new tariff issued last February is still being contested by the public as Labour and the National Assembly has issued statement threatening court case.

    Of course, the general perception that power is a public commodity, hence it should be given free or subsidized as was the practice before privatization. This  makes revenue collection a huge problem as the public don’t normally want to pay; some practically steal the power making it difficult for Discos to collect up to 25% of energy consumed by the public leaving more than 75% as commercial and collection losses in the country.

    All these problems require the collaboration of  government and the private investor as partners to address, not singling only one to be blamed.

    Reducing technical and non technical losses in the power sectors is a major issue that many countries in the developing world are still battling with. Briefly, losses in electricity supply refers to the amount of electricity injected into the transmission and distribution grids that are not paid for by users. The losses have two components, technical and non technical. Technical losses occur naturally and consist mainly of power dissipation in electricity system components such as transmission and distribution lines, transformers and measurement systems which should not be more than 10%. Non – technical losses are caused by actions  external to the power system and consist primarily of electricity theft, non-payment by customers, and errors in accounting and records keeping. Technical losses represent an economic loss for the country.

    Non-Technical losses represent an avoidable financial loss for the utility in the sense that it should be paid for by the consumers. Non-technical losses have several perverse effects in the society. Customers being billed for accurately measured consumption and regularly paying their bills are subsidizing those users who do not pay for electricity consumption; this include case of electricity theft through illegal connection to the grid or tampering with consumption meters; it also include unmetered consumption by utility customers who are not accurately metered for a variety of reasons, which in most cases is due to inefficiency of the operators to manage operations.

    Distribution companies since takeover have been struggling with these problems without government support despite the fact of its shareholding in the utilities. Even the regulator has not favourably supported the Discos in its regulations. Frequent statements of the past leadership of the commission urging consumers  not to pay for fixed charge if power outages is recorded for more than 15 days in a month, removal of collection losses from tariff though subsequently restored did not show consistency on the part of the regulator. The recent uproar over the new tariff is another issue of concern for the market, and government’s continued silence on the matter does  not give confidence to the investors on the sustainability of the new tariff.

    As it was the case in other countries especially  India  where Nigeria copied its privatization,  government should be actively involved in  supporting the utilities in improving collections. Here government can introduce such measures to address revenue collection problems faced by the Discos , particularly the huge accumulated bills  owed by the MDAs which is over N60 billion.  Some of these MDAs and  security formations that  cannot easily be disconnected from services  are owing huge bills. The  recognition of  these debts  and electricity theft by government  and enacting a Law to try offenders through a tribunal will ensure speedy trial of defaulters including utility staff who collude with the public to perfect this criminal act. This  will help the Discos in reducing collection losses.

    The Discos have so many cases of meter bypass, vandalization of electric cables in regular courts which usually takes time to prosecute. A  special tribunal will speedly prosecute and punish offenders to deter others from perpetrating in the act. This will result in increased revenue for the Discos who will invest in metering to stop estimated billing and equipment to improve power supply even at reduced rate.

     

    • Tsavsar, a consultant on Public-Private Partnerships, writes from Abuja
  • Shareholders laud UBA’s 2015 performance

    Shareholders laud UBA’s 2015 performance

    •N22b dividend approved

    Shareholders of United Bank for Africa (UBA) Plc have praised the board and management of the bank for sustaining growth and returns to shareholders in 2015 in spite of the tough operating environment.

    At the Annual General Meeting (AGM) of the bank in Lagos, shareholders approved the bank’s final dividend of 40 kobo per share, bringing the total payout for the 2015 business year to 60 kobo per share or N21.77 billion. UBA had paid an interim dividend of 20 kobo in September 2015.

    National Coordinator, Independent Shareholders Association of Nigeria (ISAN), Sir Sunny Nwosu, praised the bank for growing profit and increasing dividend payment at a time when many other banks recorded lower profit and had to cut dividends.

    He said noted that the dividend payment reinforces the resilience of the bank amidst challenging operating environment and it also shows the quality of the bank’s management.

    Addressing the shareholders, chairman, United Bank for Africa (UBA) Plc, Mr. Tony Elumelu said the bank’s strong performance in 2015 reflected efficiency gains, prudence and best practice in risk management.

    He pointed out that the bank grew gross earnings by 10 per cent to N315 billion in 2015 in spite of relatively weak liquidity in the Nigerian foreign exchange market, which reduced foreign currency related business and income lines.

    “Our bank offset the macroeconomic challenges with improved customer service and balance sheet efficiency,” Elumelu said.

    He added that the bank successfully managed its costs throughout the year, thus preserving earnings to deliver a profit before tax of N68.5 billion, which translates to 22 per cent growth over its performance in 2014.

    Elumelu warned that developments in financial technology were changing the game in the financial industry, lowering operating costs and broad customer reach and becoming major disruptors within the banking industry.

    He, however, assured that UBA is a part of the leading technology change agents,  and thus well positioned to benefit from the brave new world offered by advancements in technology.

    Also Group Managing Director, United Bank for Africa (UBA), Mr. Phillips Oduoza, explained that management identified and eliminated fats in the system and improved on contract negotiations.

    He added that the bank eliminated overlapping functions and structures and continued to leverage technology in its operations, particularly in servicing its over  eight million customers through low cost service channels, which ensured it delivered improved performance to shareholders.

    Shareholders were introduced to recently announced group managing director-designate; Kennedy Uzoka.

    Uzoka assured the shareholders that the bank is committed to sustainably delivering superior returns to shareholders in excess of their expectations.

    He noted that the bank’s African subsidiaries are growing stronger and the group has a target to increase Africa’s contribution to the group’s profit to over 25 per cent in 2016 from 24 per cent in 2015, without undermining the positive outlook on Nigeria, where he expects to see positive growth from imminent implementation of the 2016 budget.

    Uzoka said that UBA market share is increasing in most of its target markets, as it grows loans and deposits in double digits across most of its operations in Africa.

    Key extracts of the audited report and accounts of UBA for the year ended December 31, 2015 showed that gross earnings rose by 10 per cent while profit after tax grew by 25 per cent.

    UBA Group’s gross earnings closed 2015 at N314.83 billion as against N286.62 billion recorded in 2014. Profit before tax rose from N56.20 billion to N68.45 billion. Profit after tax also increased from N47.91 billion to N59.65 billion. Earnings per share thus improved from N1.53 in 2014 to N1.79 in 2015.

  • Customs boss promises optimum performance

    Customs boss promises optimum performance

    The Comptroller-General of Customs, Col. Ahmed Hameed Ali (rtd) has promised to increase the performance of officers and men of the service to meet the revenue target set by President Mohammadu Buhari.

    The Federal Inland Revenue Service (FIRS) and the NCS were given the mandate to generate the major part of the over N6.08 trillion 2016 budget  to sustain the nation’s economy following the fall in crude oil price.

    Ali gave the assurance during his tour of the Oyo/Osun Command of the Service yesterday where he visited Saki , Oyo State Office of the Command to access the facilities  at the border town.

    Accompanied by the Controller of Oyo/Osun Command, Mr Temitope Ogunkua and other senior officers from the Headquarters, Abuja , the Customs chief said to achieve the mandate, the welfare of the officers and men of the Service must be improved.

    He was optimistic that both the FIRS and the NCS could achieve the revenue target of the nation ,

    but emphasised the need for staff motivation and provision of infrastructure.

    He said: “We expect nothing but the optimum in  terms of performance; we are working assidously towards increasing our performance.

  • Perm Sec laments LASTMA officers’ performance

    Perm Sec laments LASTMA officers’ performance

    Ministry of Transportation Permanent Secretary Mr Sewedo Oluseyi Whenu has expressed displessure over the performance of some Lagos State Traffic Management Authority (LASTMA) officers, saying it is below par.

    Whenu urged them to focus on their jobs to ensure smooth flow of traffic, warning them to shun bribery and corruption.

    He spoke last Friday at the 2016 LASTMA Management Retreat in FESTAC.

    The Permanent Secretary reminded the officers of their duties, urging them to move LASTMA to greater heights.

    Speaking with The Nation, LASTMA Chief Executive Officer Chris Olakpe said the retreat was organised to review the agency’s failings and to build on its achievements.

    “We want to introspect after three months into the year, look at our pluses and minuses and to ask other people to come so that we can sharpen our wits and be able to share our weaknesses and strength and opportunities and threats to be able to move forward.

    “We intend to build a new LASTMA through collaboration. In fact, on Thursday, we are building what we call a LASTMA Community Relations Committee which would include LASTMA officials, members of the National Union of Road Transport Workers (NURTW), Road Transport Employers Association of Nigeria (RTEAN), luxury drivers association, the police and members of the Federal Road Safety Corps (FRSC) and sundry agencies. It would also include members of the public sector all coming together under one body in order to collaborate on moving traffic in Lagos.”

  • Survey scores Lagos high on performance

    A report of the United Kingdom (UK) government’s Department for International Development (DFID) has scored the Lagos State Government high in the implementation of policies that encouraged good governance, quality education and functional health care delivery.

    The report, which was released to the public on Thursday, followed a Citizens’ Perception Survey (CPS) carried out by Independent Monitoring and Evaluation Project (IMEP) in 10 states that benefited from DFID-sponsored State Level Programmes (SLP).

    The survey had Lagos rated against nine other states as a group to measure and track changes in the citizens’ perception on the achievement of the SLPs, which include state accountability and voice initiative, education, health care and state employment. The survey was held between July 2014 and June 2015 to measure the achievement of the 10-year partnership programme.

    The CPS project supervisor, Dr. Elizabeth Omoluabi, said more than 12,964 people were interviewed during sampling in the 10 states, noting that the aim of the survey was to gauge the level of involvement of citizens in governance, service delivery and provision of basic amenities that would facilitate development.

    Dr. Omoluabi said the result of the survey was representative of the citizens of the selected states, cautioning that the report should not be seen as reflection of governance in states not captured in DFID partnership.

    On education, the DFID report states: “Ninety-six per cent of children of the official school age are currently attending school in Lagos. This figure is higher than the number of school-age children in the nine other states considered in the survey. In Lagos, the Net Attendance Ratio at primary school is 95 per cent for boys and 96 per cent for girls, indicating that there are almost no gender preferences.”

    The survey revealed that more than half of school-age children are attending private schools, adding that citizens’ satisfaction with public and private schools are similar.

    The DFID report also said 70 per cent of all Lagos citizens who use government health facilities are satisfied with the quality of service, adding that the satisfaction was expressed by the poor. It added: “About 42 per cent of the poorest households and 49 per cent of the wealthiest 60 per cent visited a government health clinic, at least, once in last year.”

    On good governance and citizens’ inclusion in governance, the report said people’s satisfaction about government’s service delivery in road maintenance, community safety and availability of medicine was 20 percentage points higher in Lagos than they were in other states. The survey also showed that women have equal chances as men to attain high positions in Lagos, compared to other states sampled.

    Omoluabi said the report gave a snapshot of people’s feeling about governance and service delivery in the sampled states. She further said the achievement recorded by the DFID-sponsored projects would be handed over to the government of the benefiting states for continuity.

    Other states that benefitted from the project were Enugu, Kano, Jigawa, Kaduna, Anambra, Katsina, Niger, Yobe and Zamfara.

  • High altitude performance centre: IAAF, CAA to support Nigeria

    The Confederation of African Athletics (CAA)  in conjunction with International Association of Athletics Federations (IAAF) has said they will help to promote long-distance races.

    The President of CAA, Hamad Kalkaba, on Saturday in Lagos said the body would support the building of a high altitude performance centre in the northern part of the country.

    “The IAAF and CAA will encourage long-distance races in Nigeria by building a high altitude performance centre in the northern part of Nigeria,’’ he said.

    Kalkaba, who represented IAAF President, Sebastian Coe, said the push had been on by the Athletics Federation of Nigeria (AFN) for a while, adding that there would be a rethink.