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Access, Diamond Mobile Apps To Run Side-By-Side

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Customers are at the center of the Access Bank, Diamond Bank merger to create a leading outfit. Diamond Bank customers will lose nothing under the new arrangement. Access Bank will bring to bear on the deal its commitment to customers, financial inclusion, sustainability, corporate expertise, and strong balance sheet.

Both banks’ Mobile Apps will run side-by-side until when they become so much alike that their 13 million customers will not bother about their integration.

Globally, business combinations are seen as the surest route to achieving greater impact and giving customers the more values and enhancing profitability for the entities.

The merger deal between Access Bank Plc and Diamond Bank Plc, which will be concluded in April, presents great benefits to customers especially in the deployment of technology in providing banking services.

Based on the agreement reached by the boards of the two financial institutions, Diamond Bank shareholders would receive a consideration of N3.13 per share, comprising N1 per share in cash and the allotment of two New Access Bank ordinary shares for every seven Diamond Bank ordinary shares held as at the Implementation Date.

The offer represents a premium of 260 per cent to the closing market price of N0.87 per share of Diamond Bank on the NSE as of December 13, 2018, the date of the final binding offer. Immediately following completion of the merger, Diamond Bank would be absorbed into Access Bank and it will cease to exist under Nigerian law.

“Together, we will bring the power of banking to millions across Nigeria, focused on speed, service, and security. We are determined to ensure that both Access Bank and Diamond Bank customers will experience no disruption to normal banking services while we join forces to create Nigeria and Africa’s largest retail bank by customers. While there may be some changes in due course, we are committed to inform you ahead of time and in a way that is most convenient for you,” both lenders said in an emailed statement.

Executive Director, Personal Banking, Access Bank Plc,  Victor Etuokwu, had during a media briefing in Lagos gave insight on what the future looks like for both lenders. 

He said: “ It is a merger of two big banks to meet the needs of customers. We are going to run the mobile Apps of both banks side-by-side until when they will look alike, and when eventually integrated, customers will not even know. We know that Diamond Bank Mobile App is a market leader and we will leave it that way and same thing applies to the Diamond Extra”.

Continuing, he explained that where there are two close branches of both lenders, the customers will be the ones to determine which one will be closed, based on performance.

“If we have two branches like in Gbagada, Lagos, we will keep both of them open for one or two years. Then we will see where the customers go. Our customers will decide where they want to go. For us, we believe that the customer is king, and this merger is about giving the customer the best of services and value,” he stated.

Findings also showed that existing Diamondxtra customers have nothing to worry about as the reward scheme is not changing and winners will continue being paid while new winners will continue to emerge.

Infact, with the merger with Access Bank, Diamondxtra will become bigger and better as the scheme will also be opened to Access Bank customersThe merger will create about 13 million mobile customers, 3,100 Automated Teller Machines, over 600 branches and 29 million customers.

Besides, Diamond Bank customers can now enjoy instant borderless banking from any Access Bank branch.

“When they walk into any Access Bank branch and initiate payment in their local currency, the beneficiary will receive an instant direct credit to their account or cash in their local currency. This service is available in all Access Bank subsidiaries – Nigeria, Ghana, The Gambia, Democratic Republic of Congo, Rwanda, Zambia and Sierra Leone,” the bank said.

Financial analysts said some other objectives behind mergers of the banks include increasing customer base and expanding into new activities.
Another important advantage of merger is that the process reduces competition and eliminates competitors from the banking industry.

Announcing Access Bank as the preferred bidder, Diamond Bank’s Chief Executive Officer, Uzoma Dozie, said the potential merger of the two banks would create Nigeria’s and Africa’s largest retail bank. He added that the transaction, to be completed in the first half of the year, is in the best interest of all stakeholders.

Dozie also stated that the completion of the merger is subject to certain shareholder and regulatory approvals, adding that the proposed merger would involve Access Bank acquiring the entire issued share capital of Diamond Bank in exchange for a combination of cash and shares in Access Bank via a Scheme of Merger. Based on the agreement reached by the boards of the two lenders, Diamond Bank shareholders will receive a consideration of N3.13 per share, comprising N1 per share in cash.

Dozie said the transaction would include the allotment of two new Access Bank ordinary shares for every seven Diamond Bank ordinary shares held as at the implementation date. He said the bank’s shares would be absorbed into Access Bank at the completion of the merger and Diamond Bank would cease to exist under Nigerian law.

“ The board of Diamond Bank believes that the proposed combination of the two operations provides an exciting prospect for all stakeholders in both businesses,” he said.

Access Bank CEO speaks
Access Bank Plc Group MD/CEO Herbert Wigwe said the bank has a strong acquisition and integration track record.

Speaking to the conclusive acquisition of Diamond Bank, Wigwe said the banks involved have complementary operations that will ensure benefits for customers of Access Bank and Diamond Bank. “Access Bank has a strong track record of acquisition and integration and has a clear growth strategy,” Wigwe said via a joint statement with Diamond Bank.

“Access Bank and Diamond Bank have complementary operations and similar values, and a merger with Diamond Bank, with its leadership in digital and mobile-led retail banking, could accelerate our strategy as a significant corporate and retail bank in Nigeria and a Pan-African financial services champion. Access Bank has a strong financial profile with attractive returns and a robust capital position with 20.1 per cent Capital Adequacy Ratio as at 30 September, 2018. We believe that this platform, together with the two banks’ shared focus on innovation, financial inclusion, and sustainability, can bring benefits to Access Bank and Diamond Bank customers, staff and shareholders.”

Stakeholders speak on the deal 
Lagos Chamber of Commerce and Industry (LCCI) Director-General, Muda Yusuf, said the first gain of the takeover is that Diamond Bank has been saved from going under and the economy protected from the consequences of such occurrence.

“Today, the good thing is that depositors fund is safe. Some of the employees are not likely to lose their jobs since it is acquisition, and that is good for the economy. If Diamond Bank had failed completely, there would be systemic effect. In terms of foreign perception, acquisition or merger is better than bank failure,” he said.

Yusuf, however, advised shareholders to be more active in knowing how their banks are run. “Shareholders should provide effective oversight to ensure that their investments are protected,” he said.

Also, former Diamond Bank’s General Manager, Richard Obire, said Diamond Bank has such a brilliant brand name and customer base and these are what Access Bank will inherit. “The name Diamond Bank is gone forever and the next will be integration, which will lead to exit of the bank’s management team.”

Former President/Chairman of Council, Chartered Institute of Bankers of Nigeria (CIBN), Okechukwu Unegbu, said the process of takeover of Diamond Bank was an improvement from what happened at defunct Skye Bank.

According to him, the decision is a proactive step when compared to that of Skye Bank because Diamond Bank investors will even gain in the new arrangement.

“I think that shareholders of Diamond Bank did not lose much. Whether it is merger or acquisition between the two banks, the fact is one big bank is better than two weak banks.

“With this development, one expects a strong, virile and capable institution in the future that will equally protect the interest of the investors,” he said.
He, however, said the CBN should institute new measures that ensure that people who violate banking rules are punished.  “The CBN is the regulator and is expected to monitor and punish some of the recklessness of some of the banks and their managing directors. Banks’ boards should be held accountable. Again, there should be extra-ordinary shareholders’ meeting to approve the acquisition and possibly plan for a seamless integration process,” he said.

Michael Azu, a Lagos-based financial analyst, said the acquisition would boost stability and investors,w adding that it was a welcome development instead of allowing Diamond Bank to face regulatory sanctions and possibly liquidation for its poor liquidity positions.

“The merger has helped to protect investors’ and depositors’ confidence. It has ensured that depositors’ funds are protected from undue risk, and also removes the issue of systemic failure in the financial system,” he said.

Diamond Bank’s position
Diamond Bank had earlier announced its decision to drop its international operating licence to focus on national operations following capitalisation issues.

Dozie said: “The re-licensing as a national bank supports Diamond Bank’s objective of streamlining its operations to focus resources on the significant opportunities in the Nigerian retail banking market, and the economy as a whole,” he said in a statement.

“The move follows Diamond Bank’s decision to sell its international operations, which included the disposal of its West African Subsidiary in 2017 and Diamond Bank UK, the sale of which is currently in its final stages.

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AFDB, Fidelity Bank Sign $50m Financing Agreement For MSMEs

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The African Development Bank (AfDB) and Fidelity Bank Plc Tuesday signed a $50 million financing agreement, designed to boost the Nigerian bank’s impetus in promoting the growth of the micro, small and medium enterprises (MSMEs) segment of the economy.

The agreement-signing ceremony in Abuja Tuesday was a formal consummation of the AfDB Board’s October 10, 2018 approval of the facility, which is totally dedicated to financing the MSMEs.

A minimum of 30 per cent of the entire facility will be devoted to wholly women-owned enterprises.

In his remarks at the ceremony in Abuja, the AfDB Senior Director/Country Representative, Ebrima Faao, who signed on behalf of his bank, said the pan-African financial institution was excited with the Fidelity Bank partnership.

“We are excited about this partnership. The lines of credit tended to be general support for SMEs. This one has strong emphasis on gender. It can be considered as a vanguard credit for us.

“Our main focus is to reach out to SMEs to give the much needed impact. We count on you to ensure that the requirement for loan disbursement is okay to enable it reach out to the target audience,” Faao said.

He had previously described Fidelity Bank as a niche player, focused on the SME space, adding that the $50 million credit line will contribute to strengthening its presence in its key market segments.

The Deputy Managing Director of Fidelity Bank, Mohammed Balarabe, who also signed for his bank, stated that this line of credit granted to his bank was principally targeted at the MSMEs.

In an interview with THISDAY, he said: “It’s particularly unique because gender has been brought in mainly because 30 per cent of this loan is to be targeted at MSMEs that are driven by women.

“So, that makes it unique. We are very proud to be partners,” he added.

On the criteria for determining the businesses of the 30 per cent of the loan designed for women, Balarabe said: “Obviously, they have to be run by women. Most importantly, it is aimed at businesses at that low level so that they can catalyse development in the country.”

He noted that the MSMEs sector remains the most active in terms of generating employment and fostering development.

According to him, these accounted for his bank’s consistent targeting of that segment.

“That’s why the AfDB has found us fitting to be one of the banks that will be benefiting for onward lending to MSMEs.

“Fidelity is one of the leading lenders to the segment, but for us, it’s not all about lending. Our engagement with MSMEs is more. We take time to find the needs of such businesses, and work with them on how to run the businesses,” he stated.

He disclosed that when it is absolutely necessary, Fidelity extends a line of credit to such businesses at cheap rates, which are far lower than market rates.

The $50 million AfDB facility is aimed at enhancing Fidelity Bank’s liquidity and helping to meet the demand for medium-term funding to players in the MSMEs segment.

The MSMEs, AfDB believes, account for 30 per cent of Fidelity Bank’s loan portfolio. The selection of the Nigerian bank for the seven-year credit facility, with a two-year moratorium, is based on its strong presence in the MSMEs.

It is also in recognition of the bank’s credit management and strong track record with AfDB.

It had previously received $18 million and $75 million lines of credit from the development finance institution in 2001 and 2013, respectively.

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UBA Celebrates 70 Years Of Excellent Services To Customers At Its Special CEO Awards Gala

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Pan African financial institution, United Bank for Africa (UBA) Plc with operations in 20 African countries and in the United Kingdom, the USA and Paris, over the weekend, celebrated 70 years of operations in an event that was as exciting as it was nostalgic.

Clients, friends and well-wishers from all works of life joined the UBA Group led by the Chairman Mr Tony O. Elumelu, to commemorate 70 years of legacy with the organisation which has over the decades, emerged as one of Africa’s topmost financial giants.

The platinum anniversary of UBA was combined with the bank’s annual CEO awards ceremony as members of staff from all 23 countries of operations who had excelled over the past year were rewarded in the midst of thousands of guests.

In attendance at the epic night of activities, were royal fathers, captains of industry, political leaders, clients and friends of the bank. Some of the guests present were the Ooni of Ife, Oba Adeyeye, Enitan Ogunwusi; the Emir of Kano represented by the Sarkin Shanun of Kano, Alhaji Shehu Mohammed; Former and Present Governors of Cross Rivers State, Donald Duke and Prof Ben Ayade; Governors-elect of Lagos, Ogun and Kwara States, Babajide Sanwo-olu, Dapo Abiodun and AbdulRahman AbdulRazak.

Also present were Pastor Tunde Bakare; Chief Emeka Anyaoku; Otunba Gbenga Daniels; Chief Segun Osoba; Otunba Niyi Adebayo; Dr Jim Ovia; Oba Otudeko; Nnamdi Okonkwo; Rasheed Olaoluwa, amongst many others.

Former Presidents Olusegun Obasanjo and Ibrahim Babaginda who could not attend the event sent in letters of congratulations to commend the bank on its landmark achievements.

The Chairman, UBA Plc, Mr. Tony Elumelu, accompanied by his wife Dr. Awele, remarked that UBA remains a leading financial institution on the continent and hitting the 70th year mark was a laudable achievement.

He said, “It is a time to celebrate UBA’s rich heritage and legacy over 70 years and to tell everyone who has contributed to what UBA is today, that we appreciate all they have been doing and how they have ensured that the investment put into the bank over the past decades have paid off.”

Tony Elumelu who invited all past chairmen, board members and management as well as senior staff both past and present on stage said “These are cherished moments for us, and we’d like to thank all of you who have made it possible for us to be where we are today. Thank you to everyone, our customers, stakeholders and those who have passed through UBA and worked hard to lay a solid foundation for creating a foremost institution. It is an evening worth celebrating for us all. 70 years is a huge number, a milestone achievement” he enthused.

The Group Managing Director/Chief Executive Officer, Mr. Kennedy Uzoka, spoke about the banks’ achievements over the past 70 years and some of its objectives for the coming years, commending staff for their hard work and resilience that have contributed to UBA retaining its position as Africa’s top bank of choice.

“Every year, it is our tradition to appreciate our people who have put in their very best and gone far and beyond the call of duty to deliver excellent services to our customers and this year is even more exciting as we celebrate 70 years of our existence.

Mr Jim Ovia, Chairman of Zenith bank, commended the management and staff of the bank, adding that “UBA remains one of the greatest banks in Sub Saharan Africa. UBA is built to last. I heartily congratulate all staff and shareholders. I should have bought UBA shares but I guess it is not too late to do that’ he stated.

At the celebrations, the story of UBA was depicted in the Tony Award winning Broadway musical of the Lion King. Serengeti depicts the story of the young cub who grew into a strong Lion, in spite of the odds, and empowered all the other animals in the jungle. Great performances by A-list artists such as ‘science students’ crooner, Olamide, Phyno, Patoranking, Dbanj and female sensation, Tiwa Savage entertained the audience of over 2500 guests. The surprise act which ended the night on a high, was the performance by award winning Nigerian artist, Wizkid who delivered nothing but the best in entertainment.

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FCMB Commended For Impressive Performance And Higher Dividend Declaration

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Shareholders of FCMB Group Plc have commended the Board, Management and Staff of the financial institution for recording another impressive performance in 2018 in spite of the challenging macroeconomic and regulatory environment. The commendation was given at the 6th Annual General Meeting (AGM) of the Group held on April 26, 2019, in Lagos.

At the meeting, the shareholders approved the financial results of FCMB Group and payment of a cash dividend of 14kobo per ordinary share for the year ended December 31, 2018. This translates to a total amount of N2.77 billion.

Going by its audited accounts for last year, FCMB Group’s profit before tax (PBT) rose by 73% to N18.4 billion as against N11.5 billion in the preceding year. Gross revenue grew to N177.4 billion, an increase of 4.3% compared to N169.9 billion for the same period in 2017. Net interest income as at the end of 2018 rose by 3% Year-on-Year (YoY) to N72.6 billion.

In a demonstration of the enhanced confidence of customers in FCMB, deposits also increased by 19% YoY to N821.7 billion while loans and advances stood at N633 billion. Total assets went up by 21% YoY to N1.43 trillion, just as capital adequacy ratio was 15.9%.

Commenting on the development and the financial results of the Group, the Chairman of Trusted Shareholders Association of Nigeria, Alhaji Mukhtar Mukhtar, expressed delight on the increased dividend payment. According to him, ‘’This is an excellent result achieved by FCMB Group in a period of low economic activities in the country. I am highly impressed with the Group’s balance sheet quality which witnessed high growth. This shows vigorous policies that have positively impacted on and optimized the balance sheet. Another significant aspect of the performance of FCMB is the growing contributions of the subsidiaries in the profit margin. The 14kobo dividend declaration signals FCMB’s commitment to improving the lots of shareholders’’.

On his part, the National Chairman of Progressive Shareholders Association of Nigeria, Mr. Boniface Okezie, said, ‘’FCMB and its subsidiaries have done very well in terms of dividend payment and the overall performance, including the loans portfolio which is also encouraging. The fact the Bank has been able to increase its branch network is an indication that it is expanding. I believe that FCMB will build on this performance’’.

Presenting his report, the Chairman of FCMB Group, Mr. Oladipupo Jadesimi, said, ‘’In 2018, we continued to move forward on the path of good governance, strengthening and improving our corporate governance structure and bringing it into line with our long-term strategy and the highest international standards. This was in order to increase the confidence of our shareholders, investors and other stakeholders in an environment that is demanding even more transparency’’.

He added that, ‘’the Board of Directors, fully engaged and committed to the Group’s corporate culture and strategy, has the experience, knowledge, dedication and diversity needed to accomplish our objective of making FCMB one of the leading financial services groups of African origin, helping people and businesses prosper and upholding our adopted of execution, professionalism, innovation and customer focus’’.

Also speaking at the AGM, the Group Chief Executive of FCMB Group Plc, Mr. Ladi Balogun, said, ‘’the Commercial and Retail Banking Group (which includes First City Monument Bank Limited, Credit Direct Limited, FCMB (UK) Limited and FCMB Microfinance Bank Limited) grew its profit by 61%, driven by improved performance in our consumer finance business and increase in fees and commissions. Commercial and Retail Banking remain our largest group, contributing 83% of profit. Our banking franchise continued to grow as reflected by a 20% rise in deposits and our customer base also grew by 20% to 4.9 million customers’’.

Mr. Balogun also reported that, ‘’the pre-tax profit of our Investment Banking Group (FCMB Capital Markets Limited and CSL Stockbrokers Limited) increased by 24% in 2018. This performance was driven by higher conversion of our investment banking deal pipeline as well as cost efficiencies. Our stockbroking business maintained its position as a top-three player in its sector’’.

The Group Chief Executive informed shareholders, ‘’Our Asset & Wealth Management franchise (FCMB Pensions Limited, First City Asset Management Limited and CSL Trustees Limited) increased combined assets under management to over N310 billion (24% increase). In spite the reduction in fees charged by pension fund administrators by the primary regulator, our asset management businesses increased pre-tax profits by 15%. We acquired additional shares in FCMB Pensions Limited (formerly Legacy Pensions Limited) to increase our stake from 88.2% to 91.6% in 2018’’.

He assured shareholders and other stakeholder that 2019 would see continued growth along all key indices for the Group, especially those around profitability, deposits, customer numbers and assets under management.

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