Banking
Access Bank Expects Effect of Massive Cut in Expenses from Q2
By Modupe Gbadeyanka
The management of Access Bank Plc has not hidden its intention to embark on an aggressive cut in operating expenses (OPEX).
The financial institution is considering some cost optimisation strategies to give value to shareholders, some of who are expressing worry over the company’s high cost of operations, which they feel is affecting profit and dividend payout.
Recently, Access Bank held its 31st Annual General Meeting (AGM) in Lagos and the Group Managing Director of the bank, Mr Herbert Wigwe, used the occasion to inform shareholders that the organisation was already addressing the issue high operating expenses.
He said the management was taking drastic measures to ensure that expenses are reduced significantly, adding the effect would be felt mostly in the second, third and final quarter of 2020.
Business Post reports that one factors behind the high OPEX of Access Bank is its merger with other banks.
Last year, years after acquiring Intercontinental Bank Plc, merged with Diamond Bank Plc.
But Mr Wigwe believes this transaction has produced a truly diversified institution with remarkable retail presence and solid wholesale market share.
According to him, the merger between Access Bank and defunct Diamond Bank has “propelled us towards achieving our five- year strategic objectives to create the largest bank in Nigeria by total assets as well as largest in Africa by customer base with over 36 million unique customers across the network.”
“Using an agile approach and with strong dedication, we have achieved a significant milestone in financial services on the continent whilst delivering the fastest and most seamless customer Day 1 integration globally.
“With the emergence of the new entity, the bank is well- positioned to cater to the retail business through a broader reach and product offerings tailored to individual customer needs and delivered efficiently.
“Access Bank is now a tier one retail banking franchise with strong digital payments capabilities and benefiting from a diversified business mix,” he told shareholders.
The bank executive said in the 2019 financial year, Access Bank delivered a 26 percent increase in gross earnings of N666.8 billion from N528.7 billion in 2018, comprising interest in-come growth of 41 percent from previous levels to N155.9 billion despite declining interest rate environment.
“The effects of an enlarged loan book contributed significantly to the interest income growth of N155.9 billion (+41 per cent y/y), leading to strong bottom-line figures.
“The net effect on operating income resulted in strong profit before tax (PBT) of N115.4 billion as against N103.2 billion in 2018.
“The strength of the performance reflects a growing franchise supported by digital capabilities and improving customer service touchpoints.
“The retail business gained momentum, leveraging opportunities in key sectors to consolidate market share dominance through our digital loans.
“The wholesale business also continued to soar in the year, following intense marketing drive and continued investment in the sector to deliver stronger synergies,” he said.
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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