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Tag: profitability

  • CBN, NDIC to banks: look beyond profitability

    Banking thrives when lenders promote activities that make life better for the people. The Central Bank of Nigeria (CBN) and the Nigeria Deposit Insurance Corporation (NDIC) insist that banking should go beyond the profit motive, with lenders ensuring that the people and the environment where the business is done have something to cheer, writes COLLINS NWEZE.

    Banking is not all about profitability. It should be done with human face and recognition that the communities where the business is conducted should benefit from the profit that comes from it.

    The Central Bank of Nigeria (CBN), the Nigeria Deposit Insurance Corporation and Deposit Money Banks (DMBs) agree that banking can only thrive in an environment where Corporate Social Responsibility (CSR) and commitment to the communities where the business is done, are given a priority.

    The CBN has, therefore, encouraged the adoption of sustainable banking practice by banks, given that environmental and social responsibility support business success and long-term growth.

    According to the CBN and Nigeria Deposit Insurance Corporation (NDIC), sustainability reporting allows organisations measure, understand and communicate their environmental, social and governance performances.  Although the reporting system has gained currency and acceptance globally, only a few local banks and organisations encourage sustainability practices in their reports.

    To further involve corporate organisations, the Central Bank Governor, Godwin Emefiele and the NDIC Managing Director,  Umaru Ibrahim said the regulators will continue to renew its commitment towards the implementation of the NSBP, the achievements of the United Nation’s Sustainable Development Goals (SDGs) and the Paris Climate Change Agreement and reduce global poverty rate.

    For instance, two years ago, about 28 per cent of the African population was found to be severely food insecure, rising about three per cent from 2014. The continent is also found to have the highest prevalence of undernourishment – at about 20 per cent. This can basically be traced to conflict, lack of investment in agriculture, environmental challenges, but with poverty as a primary factor. Those living in poverty often cannot afford food of sufficient quality or quantity to live a healthy life.

    In 2018, the World Bank reported that extreme poverty has rapidly declined globally, with estimates showing that the number of extremely poor people—those who live on $1.90 a day or less—has fallen from 1.9 billion in 1990 to about 736 million in 2015. However, the number of people living in extreme poverty keeps increasing in Sub-Saharan Africa, actually peaking in 2018 with 437 million people, and then slowly decline again to reach 416 million in 2030.

    This year, most Nigerians were disturbed by the World Bank data referring to the most populous black country on the planet as the ‘poverty capital of the world’, with 86.9 million Nigerians still living in extreme poverty.

    The country is faced with numerous challenges, most of which are captured in the Sustainable Development Goals (SDGs) –  poverty eradication, hunger and food security, adequate provision of good health, education, advancing gender equality and women empowerment, developing infrastructure, provision of water and sanitation, provision of clean and affordable energy and taking effective action on climate change.

    In order to address these, leading financial institution, Access Bank facilitated the birth of the Nigerian Sustainability Business Principles (NSBP), by bringing together stakeholders in the financial sector with the aim of securing buy-in for the development of the nine principles . These include environment and social risk management, environment and social footprints, human rights, women’s economic empowerment, financial inclusion, environment and social governance, capacity building, collaborative partnerships, and reporting. Today, the principles are adopted by all banks in Nigeria including the CBN. This year  marks the fifth anniversary of the implementation of the NSBP in the Nigerian financial sector.

    Since 2008, the bank has successfully built a sustainability strategy driven by Sustainable Financial Services  developing innovative services that enhance the lives of customers and enables them reduce environmental and social impacts. The lender is helping in building sustainable economies – facilitating and financing sustainable economic growth through financial inclusion and education.Also, sustainable societies – supporting vibrant and successful communities in every market among others.

    Specifically, Access Bank recognises the importance of climate action, supporting people, businesses and communities in building sustainable enterprises, all of which has led to several awards both locally and internationally. Recently, it also received top honours at the 2018 Karlsruhe Sustainable Finance Awards in Germany, emerging as the winner in two categories and the Euromoney Awards for Excellence as ‘Africa’s Best Bank for Corporate Social Responsibility’ in London last July.

    During the bank’s 2018  Sustainability Awareness Week, Access Bank Group Managing Director/CEO , Herbert Wigwe, expressed the lender’s determination to create meaningful impact around the world and its subsidiaries by increasing awareness of best sustainable practices that can be implemented within its operational areas.

    He also listed profit, planet, and people as the pillars in which corporate sustainability are entrenched, stating that “this comes with a vision to be the most sustainable and respected bank in Africa, financing and facilitating brighter futures for all of our stakeholders through innovative services and best in class operations”.

    Sustainability,  Enterprise and Responsibility Awards (SERAs) CSR highlight different factors for improvement and national development, especially in working with different organisations to eradicate poverty and engender transformative change that guarantees a safe, equitable and sustainable world for both the current and future generations.

    The SERAs award is an annual project which aims to promote as well as raise awareness about the roles organisations play with an emphasis on their responsibility towards stakeholders and the social development of Africa.

    The 12th edition of the award was recently held on Saturday, December 1,  in Lagos. The event attracted several dignitaries and executives from diverse sectors. There were 22 categories open for contention, four of them were won by Access Bank including the Best Company in Partnership for Development, Best Corporate Communication Team, Sustainability Practitioner of the Year – received by Omobolanle Victor-Laniyan, Group Head of Sustainability Access Bank and the Most Responsible Business in Africa, both of which were the biggest awards of the night and for Access Bank, a back-to-back success.

    For Access Bank Plc., banking also includes empowering the people and giving their lives a positive meaning. That explains why it has continued to take steps that promote the common good. For instance, the Operations Unit of Access Bank Plc recently handed over two blocks of classrooms it renovated to the Keke  Nursery and Primary School, Agege, Lagos. The Bank did not only strengthen the dilapidated buildings and fortified them with iron formations, it also changed the roofs, windows and painted the classrooms to give them new looks.

    Speaking on the gesture,  Victor-Laniyan, said: “The fact is that in every environment we operate, we must make the people better, the environment better while trying to drive profit. So, we are not just focused on making money – it is just one aspect of the things we are keen on.”

  • Vodacom: collaboration key to efficiency, profitability

    Collaboration to enable large and small businesses with specific problem solving solutions will create efficiency to ultimately increase profitability, Vodacom Business Nigeria, has said.

    Speaking at this year’s Nigeria Technology Innovation and Telecoms Awards in Lagos at the weekend, where the firm won four awards, its Managing Director, Lanre Kolade, said the firm is taking the lead in the telecoms industry by providing tailor-made solutions that maximise productivity regardless of location.

    He said: “We are honored to accept the awards. Opportunities such as these remind us of the importance to go beyond just providing a service to clients. We aim to collaborate and enable large and small businesses with specific problem solving solutions that make the lives and businesses of our customers more efficient and ultimately more profitable. Our gratitude goes to these customers whose businesses are at the epicenter of the development of the Nigerian economy and look forward to exploring opportunities in future.

    “As the world progresses further into the digital age, with people and services expanding across borders, the need for a reliable end to end managed network service becomes invaluable. Our managed services provide the same high level of comfort for global businesses with reach across different territories as it does for new startup businesses with partners and stakeholders on different continents.”

    The industry celebration, organised by the Association of Telecommunications Companies of Nigeria (ATCON), aims to recognise organisations and individuals at the fore front of technological advancement and innovation in the Telecoms industry.

    Vodacom Business Nigeria was recognised as Enterprise Solution Provider of the year, Internet of Things (IoT) Solutions Provider of the year for the second consecutive year and as Managed Service Provider of the year. For the company’s stellar performance in providing optimum services for its customers, both locally and internationally, it also received the coveted Telecom Business of the Year award.

    These recognitions followed a long standing track record that Vodacom Business Nigeria has developed in the market over time, delivering superior enterprise-grade Connectivity Solutions, Cloud and Hosted Services, Enterprise Voice Solution and Internet of Things to business in Nigeria.

  • Leveraging codeshare, interline for airlines’ profitability

    Partnerships among global carriers are gaining new heights as airlines consolidate on the benefits of codeshare and interline agreements. Nigerian carriers considered ‘point-to-point airlines ‘ are fast realising that they could achieve profitability, if they forge such pacts on intercontinental routes, KELVIN OSA OKUNBOR reports.

    GLOBAL airlines are consummating the benefits of  interlining their operations through codeshare agreements.

    Under such deals, a passenger with a ticket could reach several destinations on the route operated by cooperating carriers.

    Codeshare is an interline partnership in which one carrier markets service and places its code on another carrier’s flights. This offers carriers an opportunity to provide service to destinations not in their route structure.

    Under the agreement, which is common in the international aviation sector, the originating airline and the supporting one agree on a formula for sharing the ticket cost.

    In the case of interline agreement, one carrier distributes passengers  to others on routes it does not operate into.

    There are three such alliances.   They are: One World, Star Alliance and Skyteam.

    Star Alliance, Oneworld, and Skyteam comprise 62 member- airlines, which represent more than 50 per cent of global capacity and generate more than $380 billion in revenue yearly. Passengers and airlines across the world have built a level of confidence in airlines belonging to these alliances.

    One World Alliance airlines include American Airlines, British Airways, Cathay Pacific, Finnair, Iberia, Japan Airlines, LATAM Airlines, Malaysia Airlines, Qantas, Qatar Airways, Royal Jordanian, S7 Airlines, and SriLankan Airlines and  about 30 others.

    Star Alliance’s 27-member airlines operate a fleet of 4,657 aircraft, serving more than 1,330 airports in 192 countries with more than 18,500 daily departures.

    They include Andrian Airlines, Aegean Airlines, Air Canada, Air China, Air India, Air New Zealand, ANA, Asiana Airlines, Austrian Airlines, Avianca, Avianca Brasil, Brussels Airlines, Croatia Airlines, Copa Airlines, Ethiopian Airlines, Egypt Air, Eva Air, LOT Polish Airlines.

    Others are Lufthansa German Airlines, SAS, Shenzen Airlines, Singapore Airlines, TAP Portugal, Thai Airways International, Turkish Airlines and United Airlines.

    Sky Team has 20 members, which include Aeroflot, Aerflot  Argentinas, Aerom, Mexico Air Europa, Air France, Alitalia, China Airlines, China Eastern, China Southern, Czech Airlines, Delta Air Lines, Garuda Indonesia, Kenya Airways, KLM Royal Dutch Airlines, Korean Air, Middle East Airlines, Saudia, TAROM, Vietnam Airlines and Xiamen Airlines.

    Nigerian carriers do not belong to any of the alliances.

    This, experts say, account for the inability of local carriers to compete on regional and intercontinental routes.

    To be part of global airlines’ alliance, many factors are considered.

    The qualifying carrier must have scaled through the International Operations Safety Audit (IOSA) by  the International Air Transport Association (IATA).

    Though many Nigerian carriers, including Air Peace, Arik Air, Dana Air, Medview Airlines, Overland Airways, Aero Airlines, and First Nation Airways, have passed the safety  hurdle and its enhanced versions, some are yet to be enlisted in the clearing house of the global regulator.

    IATA Regional Manager, West Africa, Samson Fatokun, said listing in the clearing house would make it easier for indigenous carriers to negotiate interline and codeshare agreements.

    According experts, Nigerian carriers are mere point-to-point carriers.

    Investigations reveal that many passengers consider carriers that could take them beyond the points operated by the originating carrier before they purchase their tickets.

    But, the paradigm is about to change as Air Peace has engaged many foreign carriers on interline and codeshare agreements.

    In an interview, its Chairman, Allen Onyema, said the airline has concluded discussions with a Middle East carrier to distribute its passengers on the Nigerian/Dubai/Sharjah route.

    He said the airline would distribute Air Peace passengers travelling beyond Dubai to other Gulf States and other destinations in the United Arab Emirates.

    Besides the Middle East, he said the agreement would also see to the partnering carrier distributing Air Peace passengers to the Far East, including China, Malaysia, and Indonesia.

    Onyema said  the airline was negotiating for interline and code-share partners on its international routes to ensure that it takes passengers beyond its own destinations.

    “We should cooperate more. We can even do spares pooling. It will help airlines. We are seeking partnership with other foreign airlines. We do not want to do point to point. We want to be a one-stop shop airline for passengers.

    “Codeshare is part of the arrangements for our proposed international flights. This is the approach we expect foreign airlines operating in Nigeria to embrace, but they appear to have a different agenda. So, we can confirm our interest in code sharing with our foreign counterparts, but we cannot  compel them to tag along.

    “We want to make sure Nigerians are proud of their own. We want to make the international community not to have anything to hold on to, to fault us. So, we want to make sure that we put in place a solid structure for the upcoming international operations. These are the reasons we have not started. We do not want to go into international operations and come out. We want to make sure we have enough planes to do the international operations. You do not begin international operations with one aircraft. If the aircraft develops fault, what do you do? You disappoint passengers? You do not  start international operations with even two aircraft, which is why we have acquired four B777. We have not started because the others have not come in. And we do not want to rush it.”

    He further said: “We have reached interline agreements with a United Arab Emirates carrier to assist us distribute passengers through the gulf region and beyond. That way Air Peace is no more a point-to-point carrier. The same agreement we will sign when we start operations into the United States and and China, that is the way to go to run a profitable airline that would give passengers access to all routes on the global network.”

    Also, Regional Manager, West Africa, Emirates Airline, Mr Afzal Parambil, said Emirates is disposed to entering into interline agreements with any Nigerian carrier, which safety and operational template align with its vision.

    He said: “This will assist us to achieve feeding and de-feeding  of passengers into our over 150 global routes. Though we once had some agreement with Arik Air, we are in discussions with some partners. We do not have any challenge partnering with any airline.

    “But we must look at the enhanced processes of such partner airline to endure it runs a smooth and efficient services in addition to evaluating the performance reliability of such carrier.This is to ascertain their safety, promptness before we sign any pact that will ensure mutuality and efficiency.”

    Last year, two African carriers – Dana Air and Asky Airlines – signed a strategic interline agreement.

    The agreement, according to the Managing Director, Dana Air, Jackie Hitharamani, was part of efforts to boost the operations of the two carriers.

    Speaking at the signing at Dana Air Corporate Head office in Lagos, the Group Managing Director of Dana Air, Jacky Hathiramani, said: “We have taken a bold step towards achieving our strategic route and fleet expansion programme. With this partnership, we shall be adding some brand new aircraft to our fleet soon.

    “We have also had advanced talks with some other notable aircraft manufacturers and very soon, some of the aircraft outside the country on maintenance, will also be arriving. This is part of our desire to provide options for our guests who have also been requesting us to consider some under-served cities in Nigeria. We want to assure our guests of our commitment towards providing safe, reliable, affordable and world-class air transport services in Nigeria.”

  • Cadbury eyes bigger market share to drive profitability

    Cadbury Nigeria Plc  will this year focus on increasing its market share and enhancing the efficiency of its distribution system to sustain growth and deliver better returns to shareholders.

    Addressing shareholders at the Annual General Meeting (AGM) at the weekend in Lagos, its Chairman, Mr. Atedo Peterside, outlined that the company would focus on four strategic areas to drive its growth ambitions in 2018, after it turned around from loss to profit last year.

    According to him, the company will focus on driving growth ahead of competition to increase its market share within its product categories while also sustaining its aggressive route-to-market initiatives.

    He added that the company will sustain its focus on quality, improvements in productivity and operational efficiencies to maximise its competitive advantage.

    He commended the staff members for upholding the tenets of good business practices in their operations, noting that as part of the four areas of focus in the year, the company will continue to implement initiatives that develop an organisation of high potential talent.

    Peterside pointed out that the recovery last year was built on four key pillars of price competitiveness, aggressive route-to-market initiatives, sustained consumer-driven activations, and exponential growth in the company’s treat portfolio.

    “We recorded impressive growth in all these four areas. We implemented parity pricing on Bournvita for the first time in 10 years and unilateral pricing on our candy brands. In our route-to-market drive, we achieved highest ever active coverage of 93,000 outlets nationwide. The consumer-driven activations for our brands delivered double-digit growth and positively impacted on our top-line. In addition, our treat portfolio contributed substantially to our profitability with Cadbury Hot Chocolate 3-in-1 brand delivering significant net revenue growth versus the prior year,” Peterside said.

    Shareholders approved the payment of N301.51 million shares as cash dividend for the 2017 business year. This implies a dividend per share of 16 kobo.

    Cadbury recorded a pre-tax profit of N350 million in 2017 as against a loss of N562 million in 2016. Key extracts of the audited report and accounts of Cadbury for the year ended December 31, 2017 showed that sales rose from N29.98 billion in 2016 to N33.08 billion in 2017. Gross profit increased from N6.86 billion to N7.44 billion. Selling and distribution expenses reduced from N5.6 billion in 2016 to N5.23 billion in 2017 while administrative expenses improved considerably from N2.07 billion in 2016 to N1.59 billion last year.

    With these, the company posted a positive operating profit of N711.37 million in 2017 compared with operating loss of N732.85 million in 2016.The company, however, came under finance pressure as interest expense jumped from N17.8 million in 2016 to N545 million in 2017. After taxes, net profit stood at N299 million in 2017 as against net loss after tax of N296 million in 2016.

     

  • Shareholders laud Dangote Flour Mills’ return to profitability

    Shareholders of Dangote Flour Mills (DFM) Plc at the weekend commended the board and management of the flour-milling company for the strategic initiatives that restored profitability and dividend payment to shareholders.

    Shareholders who spoke at the annual general meeting at the weekend in Lagos said the performance of DFM in recent period represents a new dawn, after many years of losses and no dividend to shareholders.

    President, Pragmatic Shareholders Association of Nigeria, Mrs Bisi Bakare, commended the return to profit and dividend payment noting that shareholders invested with the hopes of making returns on their investments.

    A shareholders’ leader, Mr. Sotunde Shopeju, said the return to profitability and declaration of dividends would enhance the welfare and wellbeing of shareholders.

    According to him, with the declaration of dividends, shareholders’ hope and expectations have been met as they will now begin to gain from the proceeds of their investments.

    A shareholders’ right activist, Mr. Nonah Awoh noted that the management of DFM achieved cost reduction through prudent and efficient use of resources which positively reflected in its earnings, profitability and dividend payment.

    He urged the management to continue to work to optimise the company resources.

    Another shareholder, Adeleke Olajimeji also commended the management, urging the company to be more proactive in terms of marketing and branding of its products to increase its brand visibility across the nation.

     

  • Lafarge Africa optimistic on profitability

    •Restructures South Africa’s operations

    Lafarge Africa Plc is optimistic that the ongoing implementation of a turnaround plan at its South African business and continuing strong performance of the Nigerian business will quicken the return of the group to profitability. Lafarge had in 2015 consolidated its businesses, majorly in Nigeria and South Africa, to form Lafarge Africa Plc.

    Chief Financial Officer, Lafarge Africa Plc, Bruno Bayet, said the cement group has started implementation key initiatives that will further improve the performance of its Nigerian business and help to turn around the dwindling South African business, which had impacted negatively on the group performance over the past three quarters.

    According to him, with all the initiatives, Lafarge Africa will return to profitability in the very near future, with further improvement expected in the performance of the South Africa’s operations in the second quarter.

    He explained that the decision of the company to increase dividend payout for the 2017 business year by 42.9 per cent was a demonstration of the confidence that the company remains on sound footing despite the negative bottom-line occasioned by timing of inventory movements and performance in South Africa.

    The board of directors of Lafarge Africa had recommended distribution of N13.01 billion to shareholders as cash dividend for the 2017 business year. A breakdown of the dividend recommendation showed that shareholders will receive a dividend per share of N1.50, 42.9 per cent above N1.05 per share paid for the 2016 business year. The company has indicated that the dividend would be paid from its 2012/2013 pioneer profit reserve, implying that there would be no deduction of 10 per cent withholding tax.

    He noted that the performance of the company’s business in South Africa had been impacted negatively by the arrival of new competitors between 2015 and 2016, technical disruption to production and decline in South Africa’s overall cement market.

    He outlined that the group was also concerned about the performance of the South African business and has taken decisive measures to fixing the issues with the turnaround plan in place and the appointment of a new executive team that will return the business to profitability.

    “Luckily all of those issues have been sorted and we are looking forward to a much brighter future,” Bruno said.

    He said the first quarter 2018 results of the showed stability in the market and operations which have kept revenues steady in the past quarter, pointing out that improvement plans in Nigeria delivered strong operational performance while turnaround actions will be consolidated further in 2018 through energy optimisation as well as commercial and logistic improvement.

    He said the outlook for the group remains bright with expectations of a strong market, favourable pricing in Nigeria and gains from logistic and commercial initiatives expected to sustain market share and help to build earnings before interest, tax, depreciation and amortisation (EBITDA) margins above the 35 per cent benchmark.

    With energy improvement plan in Nigeria continuing to outperform with increased use of alternative fuel and coal, capital expenditure for Nigeria will be mainly devoted to energy and production optimization while turnaround plan in South Africa is focused on cost containment, commercial transformation and industrial stabilisation.

    He assured that the company will continue to find ways of optimising its fixed costs noting that the increase in operating expenses was largely due to non-recurring restructuring costs.

    Key extracts of the interim report and accounts of Lafarge Africa for the first quarter ended March 31, 2018 showed net sales of N80.6 billion in first quarter 2018, a marginal decrease of one per cent from N81.3 billion recorded in the corresponding period in 2017 due to volume in Nigeria and South Africa.

     

     

  • ‘Heritage Bank to sustain growth, profitability’

    Heritage Bank has restated its commitment to sustainable growth and profitability, notwithstanding the  prevailing adverse macro-economic environment.

    The bank’s Divisional Head, Corporate Communications. Fela Ibidapo,, said  “Its ambition to emerge as a systemic important bank in the Nigerian banking industry remains its underlying corporate growth strategy.”

    Ibidapo said,  the foundational element of its growth strategy: People, Partnership and Process have been re-calibrated to match the rapidly changing needs of its customers especially as it deploys full steam retail banking franchise.

    In a statement over the weekend, he said the bank was on a growth track and was not unmindful of the headwinds facing the domestic economy, adding that it is very optimistic that the Heritage Brand will continue to soar over the current economic tide through its collective efforts to remain an enduring institution.

    Ibidapo said the bank would continue to grow by appealing to key client segments especially in the retail space and also focus on under-penetrated banking segments while building loyalty amongst the bank’s existing customer base.

    The statement said the bank was committed to building an enduring and resilient banking franchise in the country, remarking that in the midst of the seemingly stormy realities presented by events within the political and economic environments, the bank will continue to pursue its strategic aspiration of not only being stable but also being sustainable in earnings and profitability in its growth plan.

    He said  the bank is committed to deploying its resources towards the delivery of innovative banking solutions to its customers as well as create and transfer wealth to all its stakeholders.

  • ‘Mutual Benefits returns to profitability

    Mutual Benefits Assurance Plc has returned to profitability after a foreign loan denominated in dollar and obtained by the company plunged it into a loss, Chairman of the company, Akin Ogunbiyi,  has said.

    He spoke at the 22nd Annual Thanksgiving Service in Ikeja, Lagos. He promised to reward its shareholders soon.

    Ogunbiyi said the previous year was very tough for operators, but  despite this, the company was  able to return to profitability.

    He said despite the tough businness environment, the company would soon be among the first that will release its financial statement and from the figures, they are back to profitability.

    ‘’Twenty  years after, the company still stands,despite recapitalisation and tough operating environment. Last year was tough for everybody, but as tough as it was, we are able to return to profitability’’, he said.

    Mutual Benefits Managing Director, Segun Omosehin, said the company will soon reward shareholders.

    He stressed that the management of the company has been making efforts to increase its top line and bottom line, a feat that was achieved in the outgone year.

    He said though the insurer’s 2017 audited account was yet to be out, there were positive signs that there were  better days ahead for the shareholders  and customers.

    “We are hopeful that by the time our audited account is out, we will make our stakeholders smile, especially our shareholders who have stood by us for years, during the trying time. We will make them smile soon. The thanksgiving service was a day set aside by the organisation to thank God for his mercy in the lives of its customers, the management and the entire staff of the company in the outgone year”.

    He promised the customers as well as partnering broking firms better service delivery in the current year, stating that Mutual Benefits has lots of products and service to meet the needs of insurable Nigerians.

    Meanwhile, at the event, about 86 workers of Mutual Benefits Assurance PLC were rewarded for their dedication and loyalty. The beneficiaries who were given long service award, are staff woekers who have stayed between five and 20 years,  while 22 workers were retail award recipients.

    Speaking on this development, Omosehin said the award was to recognise committed colleagues who have worked with the company for between five and 20 years.

  • Defining banking beyond profitability

    Defining banking beyond profitability

    Banking thrives in an environment where lenders promote activities that make life better for the people. Indeed, banking should strive to meet the triple bottom line: People, Planet, and Profit. Beyond  the profit motive, ir should ensure that the people and the environment where the business is done have something to cheer. That explains why Access Bank Plc is continuously giving Corporate Social Responsibility (CSR) a priority by devoting part to infrastructural projects that promote common good, writes COLLINS NWEZE.

    Banking is not all about profitability. It should be done with human face and recognition that the communities where the business is conducted should benefit from the profit that come from it.

    The Central Bank of Nigeria (CBN), the Nigeria Deposit Insurance Corporation and Deposit Money Banks (DMBs) agree that banking can only thrive in an environment where Corporate Social Responsibility (CSR) and commitment to the communities where the business is done are given a priority.

    The CBN has, therefore, encouraged the adoption of sustainable banking practice by banks, given that environmental and social responsibility support business success and long-term growth.

    For Access Bank Plc, banking also includes empowering the people and giving their lives a positive meaning. That explains why the Corporate Operations Unit of Access Bank Plc at the weekend, handed over two blocks of classrooms it renovated to the Keke Nursery and Primary School, Agege, Lagos.

    The bank did not only strengthen the dilapidated buildings and fortified them with iron formations, it also changed the roofs, windows and painted the classrooms to give them new looks.

    And to deepen financial inclusion, and promote financial literacy among the youths, the bank also used the opportunity to open savings account for some of the students in the school with N5,000 initial deposit. Some of the beneficiaries are Mary Ebokam, SeunOlowookere, OlatideIssa, AkeemAjagunna and Susan Aniagbaoso. The beneficiaries had performed in a drama during the handing over of the renovated buildings to the school.

    Speaking yesterday at the presentation of the classrooms renovated by the Corporate Operations Unit, Access Bank Plc, to the school management, the bank’s Group Head, Corporate Operations, Banjo Adegbohungbe, said the lender and its workforce will continue to assist and partner with the Lagos State to touch lives of the future generation. He said government alone cannot support and maintain the schools, adding that private sector support is also critical to ensuring that those public schools have the right tools to function effectively.

    He said the bank believes in CSR and making the society better than it met it. “At Access Bank, we believe we should give back to the society to ensure that the learning environment improves. The staff of the Corporate Operations Unit of the bank choose which project they want to finance bet it healthcare or infrastructure. The staff have continued money to make these projects a reality,” he said.

    He said that before the renovations were done, the students could not sit down in the classroom during rains.

    “We are not forced to do what we are doing. We want to contribute to the future of the students and also give back to the society. We want to see good results from the school to ensure that the sacrifices we have made are not in vain,” he said.

    Also speaking on the gesture, the bank’s Deputy Group Managing Director, Roosevelt Ogbonna, said each time the lenders speaks on governance and sustainability, it normally focus on People, Profit and Planet.

    “The fact is that in every environment we operate, we must make the people better, the plat better while trying to drive profit. So, we are not just focused on making money, it is just one aspect of the things we are keen on. So, if you listen to the bank and some of the things we boost about, is about how we have brought sustainability and governance into how business is done within our market,” he said.

    “I am sure you are aware of all the awards we are winning globally, because of these things we are doing and the supports are across the entire institutions. The individuals in the bank believe in giving and that is the demonstration of what you are seeing today,” he said.

    The gesture, which is part of the bank’s Corporate Social Responsibility (CSR) initiatives, was designed to create an encouraging learning environment for students in the school is also an expression of the bank resolve to facilitating socio-economic and educational development of its immediate area of operation.

    Adegbohungbe added that the projects were consistent with the CSR adding that the school has undertaken to improve the standard of education in the school through this extensive infrastructural upgrade.

    The Director, Curricular, Lagos State Universal Basic Education Board (SUBEB), Mrs. BunmiOteju, represented SUBEB Executive Chairman, GaniyuSopeyin at the event.

    Head Mistress of the school, Mrs. A.A Tella, praised the bank, and promised that the facilities provided by the bank will be put to best use. “The buildings will be well maintained and we will ensure that the students make the best use of the facilities,” he said.

    Education Secretary, Local Government Education Authority, Lagos, State, OlalekanMajiyagbe, who spoke on the impact of the project on the school and community, praised Access Bank for the gesture, adding that the bank has invested wisely on the future of the students.

    He said that by that investment, the bank has shown that public schools have a great future. “The learning environment is important on success rate of the students. The bank’s investment will improve on the learning environment. The Lagos State Governor, AkinwunmiAmbode has done well by providing facilities in the school, but private sector support is also important. The collaboration between Access Bank and Lagos State has brought about positive feedback,” he said.

    Speaking further, Majiyagbe said that if the learning environment is not conducive, students can be discouraged from coming to the school.

    These CSR initiatives and other positive contributions made by the bank to improve the lives of the people have given it several recognitions.

    For the second time in a row, Access Bank recently won “Outstanding Business Sustainability Achievement Award 2017” at the 2017 Karlsruhe Sustainable Finance Awards in Germany. In a related development, foremost rating agency in Nigeria, Agusto& Co, has raised the bank’s rating from “A+” to “Aa-“, with a stable outlook. The upgrade reflects Access Bank’s strong financial profile, resilient profitability levels and solid capital position. To analysts, the feat has simply confirmed the status of the bank as an outstanding brand in the nation’s financial sector.

    Aside the upgrade, Agusto& Co also recognised Access Bank as an institution of very good financial condition and strong capacity to meet its obligations.The rating is further supported by the bank’s strong domestic presence supported by extensive branch network, good liquidity profile as well as experience and skill of its management team.

    Speaking on the new rating, Group Managing Director/CEO, Access Bank Plc, Herbert Wigwe, said, “The rating only goes to confirm our consistency over the years in delivering superior value to our stakeholders in line with our vision to be the world’s most respected African bank.The upgrade in the bank’s outlook reflects our commitment to the core values of innovation, professionalism and devotion to excellence in our operations and service delivery.”

    The rating upgrade reflects Agusto&Co’s view that Access Bank has strengthened its risk profile, deepened its retail banking drive by creating a digital business and embracing a cost-reduction programme and the use of value chain to capture small businesses in the retail segment of the market.

    This is further supported by the bank’s five year strategic plan to rank among the top three banks in its chosen markets and across financial metrics by the end of 2017. It has translated to a growth in market share for Access Bank with the bank becoming the third largest bank on the basis of its total assets and contingents of N3.3trillion as at 31 December 2016.

    “We note positively, the bank’s proactive risk management measures such as frequent stress testing of the loan portfolio, the reduction in foreign currency (FCY) loan book exposures and the frequent review of its loan book played significant role in preserving asset quality,” Agusto& Co stated in its credit rating report.

    The uniqueness of the “Outstanding Business Sustainability Achievement Award 2017,” which was won at the 2017 Karlsruhe Sustainable Finance Awards in Germany was the fact that it was the first African bank to receive this prestigious accolade.

    The award conveners presented the accolade in recognition of Access Bank’s outstanding success in incorporating economic, social and environmental aspects into its corporate strategy and business processes. This prize also brings global recognition to the bank’s impressive success in holistically embedding sustainability across all aspects of operations within the financial institution.

    The award ceremony, which held last week, was attended by CEOs of leading international financial institutions, senior executives of other winning institutions and top German government officials.

    Speaking at the presentation ceremony Herbert Wigwe, Group Managing Director/CEO of the Bank said the award validates the Bank’s continuous efforts and commitment to the Sustainable Development Goals.

    “Since we were here last year to receive the 2016 “Outstanding Business Sustainability Achievement Award,” Access Bank has continued to champion responsible investing, innovative health initiatives, environmental protection and financial inclusion. We are doing this profitably. So, we continue to encourage other institutions to embrace the same principles and practices,” Wigwe said.

    “At Access Bank, we believe our operations; loan and project finance must have the barest environmental footprint. Indeed, we believe the net impact of our activities must be positive on the environment. As such, we are champions of climate change mitigation and adaptation” he added. He assured that the bank would be further motivated and maintain profitable growth while embracing sustainability.

    The conveners said the 2017 awards focused on honouringorganisations that have made outstanding contributions in the field of sustainable finance, stimulated the interests of financial institutions and other stakeholders in integrating sustainability in their core business strategy.

    It also recognises candidates who promote growth of sustainable financial instruments and markets worldwide particularly in the fields of green finance and investments, financial inclusion and social finance, green equity and holistic integration of sustainability in the financial services institutions.

  • Lifting profitability with technology, quality service

    Lifting profitability with technology, quality service

    The deployment of improved technology by the new management at FirstBank has led to quality service delivery and enhanced profitability. The coming of mVisa, introduction of new features for the FirstMobile Application meant to boost financial inclusion and the convenience that comes with digital banking are putting the lender ahead of competition. FBN Holdings Plc posted gross earnings of N581.8 billion for the full year ended December 31, 2016 audited results. It also reported N288.8 billion gross earnings in its unaudited half-year results for the period ended June 30 this year. These results, stakeholders say, represent new positive thinking at FirstBank, writes COLLINS NWEZE.

    There are three things a forward-looking bank cannot ignore. First is the power of technology. The second is innovative product development while the third is quality customer services. FirstBank of Nigeria Limited (FirstBank) has given priority to the trio.

    The bank has not only deepened its commitment to technology and quality services, but has also provided new products and services that give its customers value for their money. Fortunately, these investments are paying off speedily as seen in its rising profitability.

    FBN Holdings Plc posted combined N870.6 billion gross earnings in 30 months. It recorded gross earnings of N581.8 billion for the full year ended December 31, 2016 and N288 billion for the half-year ended June 30, this year. These results are pointers that its customers, investors and other stakeholders should be confident of better years ahead.

    The bank said its new product development and deployment of efficient technology helped it to achieve these milestones. For the full year, the FBN Holdings Plc net interest income stood at N304.4 billion, up 14.8 per cent from N265.2 billion while non-interest income of N165.5 billion, up 68.9 from N97.9 billion in the previous year’s figures.

    Also, operating income was at N469.9 billion, up 29.4 per cent year-on-year from N363.1 billion while impairment charge for credit losses was at N226 billion as against N118.8 billion in 2015. Operating expenses as at N220.9 billion, down 0.8 per cent compared to N222.7 billion in 2015 while profit before tax of N22.9 billion, up 6.3 per cent as against N21.6 billion in 2015. The firm’s profit after tax stood at N17.1 billion, up 10.3 per cent when compared to N15.5 billion in 2015.

    For the half-year, FBN Holdings posted N288.8 billion gross earnings in its unaudited half-year results for the period ended June 30, this year. The gross earnings represent 7.8 per cent year-on-year rise as against N267.9 billion recorded same period of last year. The bank’s net-interest income of N164.1 billion was up 30.2 per cent year-on-year against N126.1 billion same period of last year.

    The bank’s profit before tax stood at N35.6 billion, down 22.4 per cent year-on-year as against N45.9 billion same period of last year while profit after tax was at N29.5 billion, down 17.8 per cent when compared with N35.9 billion recorded same period of last year.

    The Group Managing Director, FBN Holdings, Urum Eke, said: “FBNHoldings has again demonstrated its strong revenue generating capacity in the current economic environment reporting gross earnings of N288.8 billion – up 7.8 per cent year-on-year.”

    FirstBank Managing Director/CEO, Adesola Adeduntan, said: “The Commercial Banking group proved its overall earning capacity with a 6.9 per cent year-on-year increase in gross earnings to N260.9 billion mainly driven by our core business operations with stronger margins”.

    “At the same time, we intensified our credit resolution efforts resulting in the improvement of the asset quality position with the reduction in non-performing loans 25.7 per cent in the last quarter to 21.8 per cent at the Commercial Banking group. We are optimistic about further improvement in asset quality and the general quality of the loan book. In the next half of the year, we will be driving enhanced revenue generation, efficiencies and profitability towards an overall improved performance, while remaining focused on sustaining the portfolio management efforts.”

    The Deputy Managing Director, First Bank of Nigeria Ltd, Gbenga Shobo has disclosed that one potentially effective way to accelerate financial inclusion and deliver a broader set of benefits is payments digitisation.

    New Management, better results

    As part of the ongoing transformation initiatives, a key priority was capital allocation with focus on balance sheet optimisation and increasing the level of earnings retention to boost capital position and drive growth.

    To support this repositioning for growth, strategic appointments were made last year, and for the first time in the history of the bank, a Deputy Managing Director (DMD) was appointed, tasked with taking significant weight off the CEO. He is also expected to provide leadership support and oversee the bank’s retail businesses including the sustainable growth of Small and Medium Enterprises.

    The bank also appointed an executive to oversee its International Banking Group, reflecting its resolve to grow the profitability of these subsidiaries in Sub-Saharan Africa, China and the UK and further unlock subsidiary returns and sweat out the investments in those markets.

    The new focus and approach to a technology-driven institution as a key to driving business is in line with the appointment of a Chief Information Officer (CIO) to oversee and drive the development of a full digital and transaction banking offering, through the digitising of the bank’s customer offerings by automating key processes. The bank is also strengthening technology infrastructure to drive efficiency across all business areas.

    Given the challenging macro environment, decline in oil prices, foreign exchange illiquidity and the resultant effect on loan portfolio, it has become even more imperative to consistently strengthen controls and processes to optimise capital and improve the quality of risk assets.

    In line with this, a new Chief Risk Officer (CRO) was appointed by the bank with a mandate to expand due diligence on risk assets, enhance profitable transactions and reinstitute a more conscious risk environment and framework.

    The bank also appointed a new Chief Financial Officer (CFO) with oversight responsibility for procurement and a mandate to leverage the lender’s liquidity position by generating a recovery in asset creation, diversifying funding sources, optimising capital and the balance sheet, and raising financial reporting to world class levels.

    “The 13-member leadership team is a combination of executives externally sourced from the pool of the industry best and homegrown talents that have been prepared and groomed for leadership roles. The philosophy of the new Management is to drive improved business performance through efficiency, revenue growth and improve risk governance as highlighted with a self-imposed reduced operating obligor limit indicating a curbed risk appetite,” the bank said.

    From the launch of refreshed website, mVisa,  introduction of new features for the FirstMobile Application to driving financial inclusion and convenience with USSD*894# Quick Banking, FirstBank is making strategic moves to stay profitable and deliver on its commitment to quality service delivery.

    The bank announced the launch of its refreshed and user-friendly website. The new website is adaptive and responsive and has a multi-real estate billboard homepage with one-click access to information.

    The website is feature rich with mortgage and loan calculators, a currency converter and a Google maps integrated branch locator. Built for the digital age, it is easy to access and navigate for the average multi-screen user.

    FirstBank’s Group Head, Marketing and Corporate Communications, Folake Ani-Mumuney, said visitors could expect to find any information they seek on the website in three simple clicks. Its mobile-enabled features make it perfect for the always on-the-move generation. The new website is considered a unique evolution for the lender in terms of information and interactive services available for customers, investors, shareholders and the global community, she added.

    FirstBank has also implemented new and exciting features on its mobile banking application – FirstMobile to enhance security and customers’ digital banking experience. The new features are the Card-in-Control functionality, the Quick Response (QR) Code, the Transaction receipt and Save beneficiary functions.

    The Card-in-Control functionality on the FirstMobile App empowers customers to be in control of their accounts and prevent unauthorized usage of cards. The service allows customers to determine channels (Automated Teller Machine, Point of Sale and Online) and countries, where their cards can be used. Customers are to go to the Card Management Service, under the ‘self- service’ menu on FirstMobile to disable or enable any of the features.

    The Quick Response (QR) payment solution on FirstMobile App allows customers to pay for goods and services by using their phone cameras to scan QR codes at merchant locations or uploading a QR code on a smart phone via the FirstMobile App. Payment goes straight from the customer’s FirstBank account into the merchant’s account and provides real-time notification to both parties.

    The transaction receipt feature enables customers generate receipt after a transaction on the FirstMobile App. This overrides any concerns around the confirmation of transactions as receipts can either be saved to the mobile phone gallery for future reference or shared directly with recipients of each transaction via email, WhatsApp, etc.

    Also incorporated into the FirstMobile App is the ‘Save Beneficiary’ feature, where customers can save beneficiary details for later transactions. This eliminates the arduous task of searching and importing beneficiaries’ details for every transaction. Now, this is convenient and FirstBank has continued to leverage evolving technology in providing cutting-edge banking services to its customers.

    First Bank of Nigeria Limited has also partnered with Visa to launch the Mobile Payments Solution – mVisa. This mobile solution allows customers pay for goods and services by scanning a QR code using a smart phone via the FirstMobile App. Payment goes straight from the consumer’s FirstBank account into the merchant’s account and provides real-time notification to both parties.

    mVisa is available on the FirstBank’s mobile banking application – FirstMobile – and it adds to the seamless multiple payment channels FirstBank customers enjoy. Customers with the FirstMobile app can make payments from their FirstBank accounts at merchants’ locations where mVisa logo is displayed.

    The bank’s Group Head, E-Business, First Bank of Nigeria Limited, Chuma Ezirim, said the lender would continue to put customers first by leading the industry in the use of technology to provide convenient and fast banking solutions.

    He said the bank’s partnership with Visa to deliver mVisa was part of the FirstBank’s strategy to deliver reliable, secure and convenient payment options to its esteemed customers.