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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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AGM 2019: Zenith Bank Declares N2.50 Dividends

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Shareholders of Zenith Bank have approved the proposal of the board to pay a final dividend of N2.50k per share as dividends for the 2018 financial year.

The shareholders gave the approval at the 28th Annual General Meeting of the bank in Lagos.

The directors proposed a final dividend of N2.50 per share in addition to the N0.30 per share paid as interim dividend amounting to N2.80 per share, as against the N2.70 per share in 2017.

The bank earmarked N87.91 billion for total dividend payment to shareholders for 2018 financial year as against N84.77 billion paid in 2017.

The Chairman of the bank, Mr Jim Ovia, said that the bank remained committed to delivering superior returns to its much valued shareholders by ensuring that a good chunk of its profits was set aside for shareholders.

“In clear demonstration of this, we had declared and paid an interim dividend of 30 kobo per share in the course of the 2018 financial year.

“We hereby propose a final dividend of 250 kobo per share. If approved, this will bring the total dividend for the year ended Dec. 31, 2018 to 280 kobo per share as against 270 kobo per share that was paid in the previous year.”

Speaking further on the financial results, Ovia said that 2018 was challenging year for all operators in the Nigerian banking industry.

He said the bank was able to fully exploit the opportunities within the environment to record a performance that attested to its durability and resilience as a brand.

“Clearly, the results are once again, a reflection of the exceptional financial of the exceptional financial health of the bank and the group.

“For the bank, total deposit was N2.82 trillion for the year ended December 31, 2018, representing a 2.9 per cent increase over the previous year’s figure of N2.74 trillion.

“Profit Before Tax rose by 13.6 per cent from N169 billion in 2017 to N192 billion in 2018.

“Profit-After- Tax similarly rose by 7.8 per cent from N153 billion in 2017 to N165 billion in 2018.

“During the same period, total assets of the bank grew by 2.7 per cent from N4.83 trillion to N4.96 trillion, while shareholders’ fund declined by 3 3 per cent from N698 billion to N675 billion.

“Gross earnings similarly declined by 0.2 per cent from N674 billion in year 2017 to N538 billion in 2018.”

Also as a group, Ovia said that the performance indices were no less remarkable.

According to him, the Group’s profit before tax grew by 16.6 per cent from N199 billion in year 2017 to N232 billion in 2018.

“Profit-after-tax grew by 10.9 per cent during the period from N174 billion in 2017 to N193 billion in 2018 while customer customers’ deposit grew by 7.3 per cent during the same period from N3.44 trillion to an3.69 trillion.

“Group shareholders’ fund grew by 0.5 per cent from N812 billion in 2017 to N816 billion in 2018, gross earnings dropped by 15.4 per cent from N745 billion in 2017 to N630 billion in 2018,” he said.

The Zenith Bank Managing Director, Mr Peter Amangbo, said the bank’s drive toward entrenching sustainable principle in its business operations gained further momentum in the year under review.

Amangbo said the bank would continue to place a high premium on developing a robust risk management framework which had helped in promoting the soundness of the financial institution in protecting its assets and ensuring its growth.

“We are committed to entrenching a robust enterprise risk management, global best practices in corporate governance and sustainability in the coming year,” he said. (NAN)

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Shareholders Laud Transcorp Hotels Plc For Impressive Performance, Approve 15k Per Share As Dividend

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The Shareholders of Africa’s leading hospitality brand, Transcorp Hotels Plc, have extolled the Company for its impressive financial results for the year ended December 31, 2018. The congratulatory remarks were made at the Company’s 5th Annual General Meeting, which took place at the Congress Hall of the iconic Transcorp Hilton, Abuja.

Following the company’s 26% increase in turnover, the Shareholders have unanimously endorsed a final dividend of ₦1.14bn for the 2018 financial year.  The final dividend translated to 15kobo per ordinary share, which is a 20% improvement over the 12kobo per ordinary share for 2017.

Speaking on the Company’s growth milestones, Chairman of the Board of Directors, Mr. Emmanuel N. Nnorom said “Transcorp Hotels Plc has exceeded the bar with an impressive turnover of ₦17.4billion from ₦13.8billion recorded in 2017, representing an improvement of 26%. This is an unprecedented achievement in the history of the Company. It is a further demonstration of our ability to adapt quickly to a changing business environment while keeping pace with global best standards in hospitality.”  The Chairman also thanked the Shareholders for their continued support and faith in the Board and Management of the Company.

Commending the company for its overall performance, Patrick Ajudua, President, New Dimension Shareholders Association said that Transcorp Hotels Plc is an embodiment of what privatisation in Nigeria should be. He further stated that good Corporate Governance and the presence of a focused Management team who are concerned with giving returns to shareholders are some underlying factors behind the company’s continued success.

The Managing Director/CEO, Mrs. Owen Omogiafo reiterated the company’s commitment to quality and global standard customer experience, drawing on the varied international awards conferred on the Company. She said “We are redefining the hospitality landscape in Africa and positioning our continent as a preferred destination for local and international tourists. Our numerous awards and recognition are proof of this.”

On the prospects for 2019, Mrs. Omogiafo noted that “Transcorp Hotels will continue to leverage on its unique value proposition and proven strategies to exceed 2018 performance.”  She further said that growth and efficiency underpinned by a strong culture of service excellence and cost optimization will drive the company.

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UBA Earnings Hits N494bn, Records Significant Asset Growth, Driven By Market Share Gains Across Africa

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The Pan-African financial institution, United Bank for Africa Plc has announced its Audited 2018 Financial Results with impressive growths achieved across major financial lines.

According to the 2018 financials filed at the Nigerian Stock Exchange on Tuesday, the Africa’s global bank’s gross earnings grew by 7.0 percent to N494.0 billion, compared to N461.6 billion recorded in the corresponding period of 2017. The Bank’s total assets also grew significantly by 19.7 percent to an unprecedented N4.9 trillion for the year under review.

These results, according to financial analysts largely demonstrates the benefits of the Group’s Pan-African footprints with continued growth in market share in key countries of operation across Africa. The contributions of ex-Nigeria subsidiaries at 40 percent, again confirms the strong footing of the Group’s franchise in Africa.

Despite the challenging business environments in Nigeria and across key markets in Africa, the Bank’s Profit Before Tax was quite impressive at N106.8 billion, a 2.4 percent growth, compared to N104.2 billion in 2017 financial year. In same vein, the Profit After Tax rose by 1.4 percent to N78.6 billion, compared to N77.5 billion recorded in 2017. Due to lower foreign exchange trading income, Operating Expenses grew by 4.1 percent to N197.3 billion, compared to N189.7 billion in 2017

Reflecting the modest appetite of the Bank in the year under review as well as impact of IFRS 9 implementation, net loans recorded a prudent 3.9 percent growth to N1.72 trillion while Customer Deposits increased by a remarkable 22.5 percent to N3.3 trillion, compared to N2.7 trillion recorded in the corresponding period of 2017, reflecting increased customer confidence and enhanced service channels. Furthermore, Shareholders’ Funds decreased marginally by 4.8 percent to N502.6 billion, reflecting the impact of International Financial Reporting Standards 9 (IFRS 9) implementation.

Commenting on the result, the Group Managing Director/CEO, Kennedy Uzoka noted that the year 2018 was important for the Group, as it gained further market share in many countries of operation. More so, the CEO was excited at strategic achievements made in the year, including the start of wholesale banking operations in London, as it seeks to leverage the Group’s unique network across Africa. UBA also opened its 20th African operation.

“Defying the relatively weak economic growth in Africa, earnings were positive and we grew our balance sheet by 20 percent, driven by the 23 percent growth in our deposit funding. In a period of economic uncertainty, we have focused on retail deposit mobilization, with exciting results. We recorded a 48 percent year-on-year growth in retail deposits and improved our CASA ratio to 77 percent, optimizing our funding mix, which will enhance our net interest margin (NIM), over the medium term,” Uzoka said.

Uzoka remained confident that the Bank’s performance would be even stronger in the years ahead and shareholders would enjoy even greater dividends, as the Group is well positioned to take advantage of imminent fiscal reforms across many economies in Africa, a positive outlook which should stimulate new opportunities in infrastructure, manufacturing, agriculture and resource sectors.

He continued: “Our operations in the United Kingdom now offer end-to-end trade, treasury, structured finance, wholesale deposit taking and ancillary services. With this development, we are better positioned to fulfill our aspiration of deepening trade and capital flows between Europe and Africa. We are also pleased with the market acceptance of our new operation in Mali”.

“Having said this, I am excited by the profitability of our ex-Nigeria subsidiaries, which now contributes an impressive 40 percent earnings to the Group. At the moment, our Nigerian business is benefiting from our product and operational focus, gaining market share – most importantly, the increasing penetration of our retail offerings is reassuring, as this fundamental progress aligns with our strategy of focusing on sustainable growth”.

“With great optimism, we look forward to a more rewarding 2019 for our shareholders, as we further sweat our resources and optimize productivity towards delivering superior returns,” he concluded.

Also speaking on the performance, the Group CFO, Ugo Nwaghodoh said that the improving mix of the Bank’s funding base and asset pricing, reinforce a positive outlook on Net Interest Margin(NIM) and broader balance sheet efficiency.

“Whilst considerable investment in people, digital transformation and channel enhancement masked cost efficiency gains within the year, with cost-to-income ratio at 64 percent, we are convinced that our diligent execution of new initiatives will ensure the reduction of Cost to Income Ratio(CIR) towards our medium-term target. Our balance sheet is being positioned to take full advantage of market swings and our strong 25 percent capital adequacy ratio provides headroom for growth, even under a BASEL III scenario. As it stands, UBA has started the year on a good note and should sustain the momentum, as we work towards improving our Return on Average Equity (RoAE),” Nwaghodoh said.

United Bank for Africa Plc is a leading pan-African financial services group, operating in 20 African countries, as well as the United Kingdom, the United States of America and with presence in France.

UBA was incorporated in Nigeria as a limited liability company after taking over the assets of the British and French Bank Limited who had been operating in Nigeria since 1949. The United Bank for Africa merged with Standard Trust Bank in 2005 and from a single country operation founded in 1949 in Nigeria – Africa’s largest economy – UBA has become one of the leading providers of banking and other financial services on the African continent. The Bank which was awarded the Best Digital Bank in Africa by the Euromoney awards in 2018, provides services to over 17 million customers globally, through one of the most diverse service channels in sub-Saharan Africa, with over 1,000 branches and customer touch points and robust online and mobile banking platforms.

The shares of UBA are publicly traded on the Nigerian Stock Exchange and the Bank has a well-diversified shareholder base, which includes foreign and local institutional investors, as well as individual shareholders.

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