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African Banking Sector Growing Stronger—Lagarde

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By Dipo Olowookere

In the years since the global financial crisis, Africa has witnessed a rapid expansion of cross-border banking, led by banking groups based in Africa that are spurring financial and economic integration and transforming the continent’s financial landscape.

These institutions are occupying a space created by the retreat of several global bank groups from Africa in the wake of the crisis.

The expansion is evident across the region. African banks headquartered from Morocco to South Africa have each established business operations in at least 10 countries. Ecobank, headquartered in Togo—is present in more than 30 countries on the continent.

The banks have facilitated many positive changes—providing customers with new and better products and services, operating improved IT and management systems, and observing more advanced regulatory and accounting standards.

But these groups also pose new challenges for African regulators and supervisors, with potential implications for economic and financial stability.

Many of these challenges have been felt worldwide, particularly in Europe, necessitating a strengthening of banking regulation and a tightening of oversight.

It falls to African financial sector regulators and supervisors to rapidly address these new challenges. They are moving to upgrade supervisory procedures and practices by embarking upon unprecedented cooperation with peers across Africa—and with international supervisors, who are facing the same issues.

This complicated set of challenges was the topic of a conference on Cross-Border Banking and Regulatory Reforms: Implications for Africa from International Experience, held in Mauritius on February 1-2.

The conference brought together more than 80 officials from Africa and Europe—including 12 African central bank governors—and bank chief executives, along with an IMF team led by Managing Director Christine Lagarde.

In opening remarks, the Managing Director spoke of the key need to ensure that supervision of bank holding companies takes place on a consolidated basis. This places an important burden on supervisors.

It is also essential that supervisors in countries hosting systemically important bank subsidiaries are involved in the process by attending meetings of supervisory colleges and exchanging information.

“You face a delicate balancing act,” Lagarde said. “You need to enhance regulation and supervision but, in implementing global standards, you also must take into account local circumstances. Fortunately, you are not alone. The IMF and other bodies recognize the challenges you face and are committed to drawing on our global experience to assist you.”

The closed-door conference addressed the supervisory challenges of pan-African banking in detail, particularly the task of coordinating among economies that are at widely varying stages of financial sector development—and where bank subsidiaries are much more important—even highly systemic—to the local economies where they operate.

It is clear that these issues are not unique to Africa. In fact, many of the challenges—ranging from data-sharing to cross-border bank resolution—are common to advanced and emerging market economies.

So an important feature of the Mauritius conference was the participation of European supervisors who are grappling with the same challenges. The group was led by Stefan Ingves, Governor of the Swedish Central Bank and Chairman of the Basel Committee on Banking Supervision. In his speech on cross-border bank resolution, Ingves spoke to the issues that supervisors in the Nordic and Baltic countries have faced, particularly during and after the global financial crisis.

The IMF has played an important role in providing technical expertise to assist the efforts to develop effective cross-border regulation and supervision, including through the Fund’s capacity development work.

The conference was held at the Africa Training Institute, which along with the Mauritius-based AFRITAC South regional technical assistance center and other regional centers, is deeply involved in this effort.

In his remarks, Ingves spoke to another role for the IMF in the cross-border banking work. “Besides being able to bring its expertise, let alone its financial muscles, to the table, the Fund often also plays an important role as a neutral third party,” he said.

Managing Director Lagarde, in her speech, spoke of the broader purpose of a stronger financial sector in Africa.

“At the end of the day, a strong regulatory and supervisory setting can help ensure that healthy banks are able to provide the lifeblood of Africa’s economic resurgence. This will be a long-term effort, and we will be with you every step of the way,” Lagarde said.

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan. Mr Olowookere can be reached via dipo.olowookere@businesspost.ng

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Fidelity Bank to Discuss Impact of CBN Policy on Diaspora Investments

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By Ahmed Rahma

A leading financial institution, Fidelity Bank Plc, has concluded plans to host its diaspora webinar series with the inaugural edition on Saturday, March 6, 2021.

The virtual session themed The New CBN FX Policy and Positive Impact to Diaspora Investments in Nigeria seeks to enlighten Nigerian citizens’ resident abroad on recent policy measures by the Central Bank of Nigeria (CBN) and their attendant implications for diaspora investments.

According to the lender in a statement, the session will also aim specifically at providing the people with valuable insights, intelligence, and expertise on how to stay on top of their investments back home.

The event, to be streamed live on YouTube and Zoom, will have in attendance dignitaries and several other persons in the financial industry.

It was disclosed that the programme was borne out of the need to deepen engagement with Nigerian diaspora community particularly as developmental partners considering the critical role remittances play in driving sustainable economic growth.

Speaking on the webinar, the CEO of Fidelity Bank, Mrs Nneka Onyeali-Ikpe, stated that the session was most appropriate and timely, adding that “the session will offer the Nigerian diaspora greater clarity on all of the recent policies enacted by government with a view to enabling them make sound investment decisions.”

According to Mrs Onyeali-Ikpe, the bank, in the last 12 years, has become a dependable partner for diaspora remittances and investment.

Armed with a deep understanding of these customers’ needs, she explained that the bank has continued to offer bespoke products and services that are unrivalled in the financial services industry which includes, diaspora mortgage and dollar denominated fixed deposit investment account that attracts up to 5 per cent annual interest depending on the amount and tenure.

Recall that the CBN, as part of efforts to liberalise, simplify and improve the receipt and administration of diaspora remittances into the country had issued guidelines to ensure that beneficiaries of diaspora remittances through International Money Transfer Operators (IMTOs) receive such inflows in foreign currency (US dollars) through the designated bank of their choice.

The policy became necessary in view of the urgent need to deepen the foreign exchange (FX) market, provide more liquidity and create transparency in the administration of diaspora remittances into Nigeria.

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Access Bank Moulds Next Drivers of Nigerian Economy

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By Dipo Olowookere

One of the top financial institutions in Nigeria, Access Bank Plc, has commenced the process of developing those that will improve the economy of the country.

The lender, through an initiative called the Africa Fintech Foundry (AFF), is assembling some emerging start-ups it believes would become a unicorn worth over $100 million in the next 10 years.

The accelerator programme will provide N10 million in cash to the top three finalists, while the others would be exposed to investors who might be interested in them.

Business Post recalls that last month, entries were opened and 306 registrations were received. After rigorous assessments, the list was pruned to 30.

Theses finalists were further screened by the Head of AFF, Mr Daniel Awe; Group Head, Emerging Businesses, Access Bank, Mrs Ayodele Olojede; and Vice President, Investments MBO Capital and Fintech Consultant, Mr Oshone Ikazobor, in a bid to narrow it down to 10 -15 finalist.

“If a start-up has an idea and you throw it into a market of 42 million customers, the acceleration is going to be faster. So, it is using the entire ecosystem of our group to build the future of the country,” Mr Awe said at the screening.

He added that, “In the next 10 years, these guys coming here we see them becoming a unicorn worth over $100 million and a season is coming where would see these startups becoming the next drivers of our economy.”

On funding available for the start-ups, he disclosed that, “Funding is based on ideas and what would be required to move the idea forward. We have a commitment of about N10 million. After they come into the accelerator program, there are a top-three but the other ones are going to be exposed to investors.

“This initiative would have a direct impact on the economy because it is targeted at the medium scale businesses and these are the businesses that can change economies in terms of reducing employment rate and socioeconomic levels.”

Also speaking at the event, the Head, Retail Product Insight and Capabilities, Access Bank Plc, Mr Rob Giles said: “We are looking for companies with ideas that can solve real-world problems and where we are different from venture capital firms is we offer an environment where startups can be supported, nurtured, advised and get access to people who are further ahead on their journey like mentors.

“We have seen three companies that can go all the way and our job is to make sure they stay the course and structure their foundations from the very beginning that would allow them to scale.”

Furthermore, speaking to one of the participating startups, the founder, Farm Delight, Ms Love Uduma, a start-up focused on agriculture value chain from production to distribution and consumption said this platform is an impactful stream for startups to get support from.

On her expectation, she said: “I am expecting tech support and a good relationship with the tech community. We have the agricultural aspect covered but we need the technical assistance and also funding.”

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Access Bank Gives Car to NYSC Member

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By Ahmed Rahma

A member of the National Youth Service Corps (NYSC) serving in Niger State, Mr Tolulope Agabaje, has won a brand new Hyundai Accent car during a promo organised by Access Bank.

The financial institution, which recently introduced a transaction campaign titled Transact and Win as part of its efforts to enhance financial inclusion through its digital platform, presented the winner with the grand prize after conducting a draw in Lagos.

At the official presentation of the car in Lagos, the Executive Director of the bank, Mr Victor Etuokwu, said the lender was targeting the unbanked and the underbanked to increase the rate of transactions through its mobile and digital platforms.

He noted that the promo was designed to play a significant role in the lives of bank customers.

“We want to continue to play a big role in the lives of our customers and as for Tolulope, we have asked him what he graduated with, he said he is a first class holder and with this, we are looking at a possibility of him working with Access Bank,” Mr Etuokwu said.

In his remarks, the car winner said he was shocked when informed of his win and felt the calls from the bank were from fraudsters but when it became incessant, he reached out to the bank via its twitter handle and was told he had actually won a car.

“I am still in shock as I was not expecting it. I cannot even remember the amount of transactions I did but I know it was too much.

“The car was not something I was looking at owning in a year or even three years but Access Bank has fast-tracked my dream of owning a car and so I would keep spreading the word to friends and family that this is indeed real,” Mr Agabaje said.

He encouraged customers and friends to open accounts with Access Bank.

Also speaking, the Lead Manager, Mobile and Internet Banking at Access Bank, Mr Osakwe Edwards, stated that the campaign will boost the bank’s digital products.

“Digital is the future and this mobile banking is what we want to get a lot of people into and you know that as a bank, we make revenue from our digital channels and we use it to boost our customer acquisition.

“These days, people do not need to get to the bank to open an account with us or perform transactio0ns, they can do that through our mobile banking platforms or USSD,” Mr Edwards said.

Commenting on the winner, he said, “Tolulope performed 10 transactions which is the criteria to win the car via the USSD or the mobile app.

“We did a draw and out of the million people that met the criteria, Tolulope emerged tops.

“For now, this is the third car that has been given. One person won in Abuja, the other won in January and so we are hoping to commence another prize presentation by the second quarter (Q2) of 2021.

“When we start by Q2, it will be on quarterly campaigns/draws and by the end of Q2, We will have another winner by the end of Q3 and Q4.”

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London Stock Exchange Lists Ecobank Nigeria’s $300m Bond

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By Aduragbemi Omiyale

The five-year fixed rate senior unsecured $300 million bond issued by Ecobank Nigeria Limited has begun trading on the floor of the London Stock Exchange (LSE).

This followed the listing of the corporate debt instrument on the respected trading platform on Thursday via a virtual ceremony witnessed by officials of the exchange and the financial institution.

The paper has an issuer rating of B- from Fitch Rating agency and S&P, while Citi, Mashreq, Renaissance Capital and Standard Chartered Bank acted as joint lead managers and book runners.

Business Post reports that the note carries a coupon rate of 7.125 per cent, significantly below its Initial Price Thoughts of 7.75 per cent.

The successful launch was three times oversubscribed and is the lowest coupon/yield by a Nigerian financial institution for a benchmark bond transaction since 2013.

“The strong demand for our bond shows the international appetite for the Ecobank franchise in Nigeria, its unique positioning for facilitating pan-Africa trade and the attractive opportunity for the many investors seeking to back world-class Nigerian corporates,” the Managing Director of Ecobank Nigeria, Mr Patrick Akinwuntan, said.

It was gathered that proceeds will provide medium-term funding and help to enhance the capacity of the bank to support international trade and service across Africa.

Ecobank Nigeria, a subsidiary of Ecobank Transnational Incorporated (ETI), the parent company of the Ecobank Group, provides the full suite of banking products, services and solutions through multiple channels to retail, commercial, corporate and public sector customers.

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Keystone Bank Boosts Lagos Environmental Sanitation

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By Modupe Gbadeyanka

The Lagos State government’s environmental sanitation efforts recently received a huge boost when the new intakes of Keystone Bank Limited donated some kits to the Lagos State Waste Management Authority (LAWMA).

The new employees, who recently graduated from the bank’s training school, The Keystone Bank Learning Academy Lagos, gave the agency 60 units of street sweepers’ uniforms.

This is aimed to boost the morale of the personnel, who work hard to keep the city very clean and it was part of the bank’s Corporate Social Responsibility (CSR) drive.

“Keystone Bank is committed to sustainability and therefore has made it a point of duty for our trainees (newly hired fresh graduates) to buy into this concept from the elementary stage of their banking career.

“Each set of banking school trainees are made to carry out a specific CSR project, which they must fund to enable them to learn the act of giving back to the society,” the Head of Learning Academy at Keystone Bank, Mr Bimbo Alabi, was quoted as saying in a statement issued by the financial institution.

He added that Keystone Bank was keenly aware that the burden of keeping the environment clean cannot be left to the state government alone, hence the intervention by the bank.

“At Keystone Bank, we are always willing to partner with organisations that are committed to keeping the environment clean, especially in the communities where we operate.

“We cannot live a healthy life, conduct business, and create wealth amidst a sick environment,” Mr Alabi noted.

While receiving the uniforms from the Keystone Bank trainees, the Managing Director of LAWMA, Mr Ibrahim Odumboni, commended the lender for being alive to its CSR in partnering with the state government to keep the environment clean.

Mr Odumboni further called on other corporate bodies to emulate the gesture of Keystone Bank for the benefit of the larger society.

The Keystone Bank Learning Academy is a full-fledged certified and accredited learning and development centre, responsible for the continuous building of skills and the expansion of the knowledge base of new and existing workers of the bank.

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SEC DG Pushes for Sustainability, Safety, Soundness of Banking Sector

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By Modupe Gbadeyanka

The need to ensure the sustainability, safety and soundness of the banking and finance industry has been emphasised by the Director-General of the Securities and Exchange Commission (SEC), Mr Lamido Yuguda.

To achieve this, the capital market expert has advised senior bankers in the nation’s banking sector to mentor the younger generation.

According to him, their commitment to mentoring the younger generation would go a long way in actualising the objectives of the Chartered Institute of Bankers of Nigeria (CIBN)’s mentoring scheme.

Mr Yuguda, who was a guest at the CIBN mentoring scheme tagged Mentoring: Unlocking Career Potentials and Possibilities in Lagos over the weekend, noted that, “Let me use this opportunity to encourage senior bankers to collaborate with CIBN in actualising the objectives of the mentoring scheme. Your commitment to mentoring the younger generation will go a long way in ensuring the sustainability safety and soundness of the banking industry.

“To the young bankers, I enjoin you to make the best use of this rare opportunity! I am confident that with the cooperation of all stakeholders, the CIBN mentoring scheme will be a point of reference for others,” he further said.

The SEC boss stated that to be a successful professional, one must be ambitious, willing to go the extra mile, try to be a value enhancer and must be outstanding.

He said that such a person must be teachable and willing to learn from other persons who are deemed successful in the same career path.

According to him, it is critical for young bankers to be mentored by seasoned senior colleagues as they progress in their careers because the banking profession is predicated on trust and professionalism.

Mr Yuguda said these values could be taught but are actually reinforced when demonstrated by senior bankers and emulated by their younger colleagues.

“Due to the peculiarities of the banking industry, it is easy for young bankers to get distracted with the prestige and sometimes material benefits that come with the profession.

“However, mentorship relationships help to keep such young professionals grounded and focused on building character, advancing their knowledge, growing their professional network and cultivating the right values.

“This is important because what makes success sustainable for a professional is a combination of skill, experience and the right values,” the SEC director-general said.

Earlier, the CIBN President, Mr Bayo Olugbemi, said that the institute had identified mentoring as a potent tool for bridging the gap between learning and doing.

“Esteemed audience, the changing times requires that we do things differently; the changing times require that we do things differently.

“At the CIBN, we believe so much that to maintain safety, soundness and stability of the banking industry, the human capital has a pivotal role to play in this wise.

“We have identified mentoring as a potent tool for bridging the gap between learning and doing.

“In order to uphold ethics and professionalism which is the hallmark of our banking industry and our great institute, accomplished and experienced bankers need to mentor the young and upcoming ones in order to sustain the ideals of our industry,” he said.

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