Banking
Wema Bank Grows Gross Earnings By 16.36% In Q3 2016
By Modupe Gbadeyanka
Despite the harsh operating environment and economic situation in Nigeria, Wema Bank has continued to record a quantum growth. This has made it one of the most trusted financial institutions in the country.
Some have attributed this to the leadership style of its Managing Director, Mr Segun Oloketuyi, who since assuming office, has repositioned the bank into a dependable brand. No wonder the Bank of Uganda was in Nigeria to learn from Wema Bank few weeks ago.
In its unaudited financial results for the nine months ended September 30, 2016, Wema Bank’s gross earnings grew by 16.36 percent to N37.89 billion from N32.57 billion it recorded in the same period last year.
In the results obtained by Business Post, the bank showed a modest improvement in operating indices.
This is despite the domestic environment remaining largely strained.
Nigeria’s August 2016 manufacturing and non-manufacturing PMI data showed underperformance(s) at 42.1 index points and 43.7 index points respectively.
Also, inflation maintained an upward trend from 17.6% (August 2016) to 17.9% (September 2016), though at a slower pace (May – September 2016), as rising interest rate and foreign exchange illiquidity continue to impact prices.
But in all these, Wema Bank maintained its commitment to innovation, introducing *945# and other digital initiatives.
These efforts continue to engender confidence with the bank’s customers, leading to a growth in savings deposits by 18.10% from N35.58 billion as at December 2015 to N42.02 billion as at the end of the period.
The bank optimized its balance sheet, as loans to customers rose by 20.78% to N177.01 billion with interest income expanding by 20.12 percent to N31.93 billion compared to last year while fees and commission increased by 16.79 percent to N4.41 billion.
Explaining how the bank was able to record successes despite the odds, MD/CEO of Wema Bank, Mr Segun Oloketuyi, explained that, “the streamlining of our processes and the leverage on technology led to improving efficiencies and cost optimisation, with operating expense declining by 1.77% Y-o-Y from N17.49 billion in September 2015 to N17.18 billion in September 2016 compared to a general inflation level of 17.9%.”
Mr Oloketuyi noted that, “We will continue to seek opportunities to improve our cost-to-serve through alternative channels and continued strategic improvements of our business model without compromising our service quality.”
“Our prudent risk management model continues to enable us deal with the industry-wide spikes in loan defaults and attendant rise in Non-Performing Loans (NPL).
“The NPL ratio for the Bank stood at 2.99% as at Q3’16 which is below the regulatory threshold of 5%. The coverage ratio for the Bank remained adequate at 124.82%,” he added.
“Going into the final quarter of the year, we do not envisage any material improvement in the operating environment,” he submitted, noting that, “Rather, we expect the gains of the fiscal and monetary policies to impact between Q1 & Q2’ 2017.”
“However, we believe we would close the year with improved performance,” he expressed optimism.
Mr Oloketuyi also declared that, “We are pleased to announce that we just concluded a Tier II capital raise of N20 billion.”
“This will boost our Capital Adequacy Ratio (CAR), currently at 13.36% (pre-capital raise) and supporting our medium term growth plan. More information will be provided once we obtain final regulatory approval,” he explained.
By Modupe Gbadeyanka
About N3.6 trillion has been repaid to the Central Bank of Nigeria (CBN) by the Asset Management Corporation of Nigeria (AMCON) since its inception in 2010.
This information was revealed by the chief executive of AMCON, Mr Gbenga Alade, during a media parley to update the press on the activities of the agency.
Mr Alade said at the moment, the organisation still owes the central bank about N3 trillion for toxic assets of banks in the country.
He praised the organisation for its asset recovery drive, stressing that when compared with others across the world, Nigeria has done well.
“It is important to stress that the corporation has done tremendously well, especially when compared to other notable government-owned Asset Management Corporations around the world.
“Based on the balance at purchase, AMCON outperformed other Asset Management Corporations all over the world by achieving over 87 per cent in recoveries despite the unique challenges associated with debt recovery in Nigeria.
“The Malaysian Danaharta, which is adjudged one of the best performing Asset Management Corporation’s, only achieved 58 per cent. The Chinese Asset Management Corporation, despite its stricter laws, achieved just 33 per cent.
“Only the Korean Asset Management Corporation (KAMCO), South Korea, has achieved more recoveries than AMCON, with about 100 per cent. This was due to their brute force with which they chased the obligors.
“Despite KAMCO’s recovery records, the agency is still operational to date with slight realignments in its mandate.
“Other noted Asset Management Corporations that have transitioned into a perpetual institution of the various governments include, China Asset Management Company, Federal Deposit Insurance Corporation (FDIC) USA, and KFW Germany.
“So, gentlemen, without sounding immodest, AMCON has done well, and we will not relent until all the outstanding debts are fully realized,” Mr Alade stated.
On the financial performance of AMCON, he said last year, the firm posted a revenue of N156.25 billion and operating expenses of N29.04 billion, while for the 2025 fiscal year should be a revenue of N215.15 billion and operating expenses of N29.06 billion.
By Modupe Gbadeyanka
One of the non-interest banks in Nigeria, The Alternative Bank (AltBank), has opened a new branch in Effurun, Delta State.
The new office will serve the Edo-Delta region and provide purposeful banking and real financial empowerment for individuals, entrepreneurs, and businesses, a statement from the firm stated.
The lender disclosed that the Effurun branch is a bold move in its mission to reshape banking in Nigeria.
The launch was graced by key dignitaries, including the Ovie of Uvwie Kingdom, Emmanuel Ekemejewa Sideso Abe I; the Chairman of Uvwie Local Government, Anthony O. Ofoni, represented his vice, Andrew Agagbo; and the Special Adviser to the Governor of Delta State on Community Development, Mr Ernest Airoboyi; amongst others.
The Divisional Head for South at The Alternative Bank, Mr Chukwuemeka Agada, emphasised the institution’s commitment to Warri and its surrounding communities.
“By establishing a presence here, we are initiating a transformation in the way banking serves the people of Delta. Our purpose-driven approach ensures that customers’ financial goals are not just met but exceeded,” he stated.
“This branch represents our pledge to empower Warri’s dynamic businesses and families, providing them with the tools to grow without compromise,” Mr Agada added.
“We understand the heartbeat of this community, and we are excited to integrate our bank into the fabric of this dynamic region,” he stated further.
On his part, the representative of the Ovie, Mr Samuel Eshenake, challenged the bank to facilitate development and employment within the Effurun community.
The Regional Head for Edo/Delta at The Alternative Bank, Mr Akanni Owolabi, embraced this challenge, pledging that the bank will work sustainably to drive local commerce.
“At The Alternative Bank, we are committed to being an active partner in the development of Effurun. We see this branch as a catalyst for creating opportunities, driving employment, and supporting the growth of local businesses.
“Our mission is to empower this community, ensuring that every step forward is one of progress, prosperity, and shared success.”
By Aduragbemi Omiyale
A partnership aimed to enable seamless, real-time and secure transactions for cardholders across Africa and the rest of the world has been entered into by Payattitude and PAPSSCARD, the card scheme initiative of the Pan-African Payment & Settlement System (PAPSS).
The collaboration will allow Payattitude cards issued by banks and other deposit-taking institutions to be co-branded with PAPSSCARD, Discover, Diners and Pulse for acceptance across their networks in Nigeria, Africa and worldwide.
As an initiative of the African Export-Import Bank (Afreximbank) and a key financial infrastructure supporting the African Continental Free Trade Area (AfCFTA), the PAPSSCARD scheme will facilitate instant cross-border payments in local currencies.
“This partnership reflects our commitment to cross-enterprise alliances and enabling inclusive, efficient, and borderless payments across Africa and the world
“With Payattitude, Nigerian cardholders and financial institutions can now enjoy the benefits of a Nigerian card that can be used worldwide,” a director at Payattitude, Dr Agada Apochi, said.
The acting chief executive of PAPSSCARD, Mr John Bosco Sebabi, said the aim is “to connect African payment ecosystems, reduce the cost and inefficiencies of cross-border payments, and strengthen African sovereignty over payments infrastructure.
“Collaborating with Payattitude, a key innovator in Nigeria’s payment space, represents a significant step towards a more unified African payment landscape.”
The chief executive of PAPSS, Mr Mike Ogbalu, said, “By bringing together PAPSSCARD’s robust cross-border payment capabilities with Payattitude’s leadership in the Nigerian digital payments, we are taking tangible steps toward building a single African market where individuals and businesses can transact easily and securely, both within and beyond Africa.”
Payattitude is the first-in-kind Nigerian Payment Scheme to pioneer multibank App and USSD Code *569#.
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