AMCON Seek Advisers On Selling Mainstreet, Enterprise, Keystone Banks

The Chief Executive Officer of Asset Management Company (AMCON), Mustapha Chike-Obi

The Asset Management Company of Nigeria (AMCON) has announced that it will appoint financial advisers by June 15 to manage the sale of Mainstreet Bank, Enterprise Bank and Keystone Bank.

The three banks were nationalised in 2011 following mismanagement of bad loans and recapitalised by AMCON.

AMCON’s Chief Executive Officer, Mustapha Chike-Obi, made this known on Thursday in an interview where he revealed plans to sell 100 percent of each of the bank.

He however added that AMCON is yet to decide on the best way to proceed.

“We have advertised for a financial adviser who will take charge of the process” said Chike-Obi.

He said the advisers would solicit expressions of interest from prospective investors.

Mr Chike-Obi said he expected strong interest in the three banks from local and foreign institutions, pointing out that South Africa’s leading bank, FirstRand, had informed AMCON of an interest in acquiring Keystone bank.

FirstRand CEO Sizwe Nxasana told Reuters last week that the South African lender was keen on buying either Keystone or Mainstreet.

Skye Bank is also expected to bid for one of the three banks, depending on valuations, its CEO Kehinde Durosimi-Etti told a shareholder meeting last week, where management sought approval to raise N50 billion.

AMCON said last week it expected to complete the sales by the third quarter of 2014.

 

Enterprise Bank Declares N11.3bn Profit For The Year 2012

 Enterprise Bank Limited rose from its first Annual General Meeting (AGM) during the week and announced an impressive performance with a profit-before-tax of N11.3billion.

The declared profit, which is for the year ended December

Chairman of Enterprise Bank, Mr. Emeka Onwuka

2012, is a marked improvement from the loss of N5.2billion for the five-month period it operated as at December 2011. It represents a growth of 316.6 per cent during the period. Other figures from the result show that gross earnings grew by 283.9 per cent to 40.4billion as at year ended December 2012 from N10.5billion achieved in the five-month period ended 2011.

The bank’s deposit also grew from N162.6billion to N208.4billion between the year ended 2011 and 2012 respectively. This represents a growth of about 28.2 per cent. Total assets also experienced a growth of 31 per cent between the periods from N198.5billion as at end of 2011 to N261.1billion as at the end of 2012.

Speaking during the meeting, the Chairman of Enterprise Bank Limited, Mr. Emeka Onwuka, attributed the achievement by the bank to a sustained growth in quality risk asset creation, which equally engendered growth in interest income.

The Chairman stated that in addition to “improvements in our other banking income items such as commissions, fees, electronic banking income, significant improvements in trade-related transactions, facilitated through our strategic focus on Small and Medium Enterprise (SME) helped in boosting our fees and commission income.”

Onwuka declared that by this sterling performance, “a solid foundation has been built by the bank to ensure a sustainable growth in its business activities.” He listed some of the valuable structures that have been put in place by the executive management of the institution, with the full support of the Board of Directors as:

 

  • Renovations were carried out on the corporate head office and branches of the bank, which is believed will enhance the competitiveness of the bank in the industry
  • Several brand management initiatives were implemented in the year, in a bid to create more awareness about the bank in the marketplace
  • The bank’s electronic banking platform has been further enhanced by capital investments in Automated Teller Machines (ATMs), Point of Sale (POS) terminals and several variants of electronic cards. Business alliances were also entered into with major players in e-business, so as to ensure seamless transaction processing on the platform
  • Capacities and competencies have been built in retail and SME banking business – sectors,  which shall fundamentally shape the future of banking in Nigeria
  • The Core Banking Application and other business applications have been upgraded to latest versions, which have enhanced the robustness and resilience of the platforms for effective and seamless business activities
  • The greatest asset; staff are being trained and re-trained on an on-going basis on courses and curriculum that would ensure enhanced productivity in their respective roles in this great institution.

Enterprise Bank is one of the bridge banks that emerged on August 5, 2011 following the takeover by the Nigeria Deposit Insurance Corporation (NDIC) of the defunct Spring Bank Plc and its subsequent recapitalization and ownership by the Asset Management Corporation of Nigeria (AMCON).

S.Africa’s FirstRand eyes retail banking in Nigeria – CEO

South Africa’s FirstRand will use Thursday’s launch of its new merchant banking business in Nigeria as a springboard to move into retail and commercial lending in Africa’s second biggest economy, the bank’s chief said.

South Africa’s number two lender won Nigeria’s first merchant banking license in more than a decade last November and opened its doors in Lagos on Thursday.

Now it wants to expand its operations in Nigeria, organically or through an acquisition, First Rand Chief Executive Sizwe Nxasana told Reuters in Lagos during the launch of Rand Merchant Bank (RMB) Nigeria.

“We are looking at having a universal banking operation in Nigeria … growing on the back of our investment banking operations into the retail and commercial banking,” he said.

“Our appetite for Nigeria is growing and we are going to be looking at opportunities that will put us in a position where we are becoming a seeded player … in other words among the top five banks in Nigeria in the next few years.”

FirstRand has been looking for an entry into Africa’s most populous country for years. It ended talks last year to buy a majority stake in Nigeria’s Sterling Bank after they both failed to agree on price.

Nxasana said FirstRand was still interested in acquiring one of the three banks, Mainstreet Bank, Keystone Bank and Enterprise Bank that were nationalised two years ago, but could also enter retail operations on its own.

FirstRand in November had said it could spend more than $300 million to buy a retail and commercial bank in Nigeria.

Banks To Stop N100 ATM Charges Next Monday

The Bankers’ Committee on Sunday said the decision earlier reached to suspend all charges accruing from the use of Automated Teller Machines (ATMs) of other banks would be implemented from Monday, December 17.

The Governor of the Central Bank of Nigeria (CBN) and Chairman of the Bankers’ Committee, Sanusi Lamido Sanusi disclosed this while addressing journalists at the end of the fourth annual Bankers’ Committee retreat held in Calabar, Cross River State.

The CBN governor said the delay in implementing the policy was to allow banks configure their information technology infrastructure for the effective implementation of the policy.

“We have agreed on a final date of Monday, 17 December, 2012 for the kick-off when every bank will remove the charges. We allowed some time for banks that have not configured their IT to do so and stop charging and hopefully by 17th of December, you are not going to have any customer pay additional charges,” he said.

Mr Sanusi further said that the CBN was working on a programme that would ensure that from June 1, next year, the Asset Management Corporation of Nigeria (AMCON) commences the process of divesting from the three nationalised banks – Keystone Bank Limited, Enterprise Bank Limited and Mainstreet Bank Limited – which are wholly owned by the corporation.

“We want to start the process by June 1 next year of getting AMCON to divest from the three banks so that by 2014, the process would have been completed,” he said.

Commenting on the privatisation of power assets, the CBN governor said the committee would advise the Federal Government to ensure that the proceeds to be derived from the sale of power assets are invested in infrastructural projects, adding that this would enhance investor confidence in the system.

He said: “With a vision for a better future for Nigerians, the Bankers’ Committee is committed to play a lead role as catalyst for economic development, improving access to finance for the unbanked and under-banked population and growth of the real sector.

“The Bankers’ Committee has focused on the power, agriculture and Transport Infrastructure sectors for driving growth and identified opportunities for financial system intervention in the transformation of these critical sectors of the economy.

“Through collaboration with the government, the banking community and real sector stakeholders, the Bankers’ Committee programmes and initiatives have contributed to a tangible improvement in the enabling environment and private sector funding for the power and agriculture sectors.”

Mr Sanusi added that banking sector lending to the agriculture sector had increased significantly from 1.5 per cent of total industry portfolio to 3.5 per cent in 2012.

He also said that the banking industry has set a target of 7 per cent for agriculture sector lending by 2013 and 10 per cent by 2017.

AMCON may list nationalised banks

The Asset Management Company of Nigeria (AMCON) on Tuesday said it may list three banks that were nationalised as part of a bailout in 2009, instead of selling them to rivals, as it seeks to determine fair value for the banks.

The Chief Executive Officer of the Asset Management Company of Nigeria (AMCON), Mustapha Chike-Obi

Mustapha Chike-Obi, the chief executive of AMCON, said the AMCON will need to find financial advisers before finalising its decision on whether to list directly or sell to competitors.

“AMCON is appointing an adviser that will evaluate and determine the value of the banks, evaluate all the options available to AMCON,” he said.

“We expect our eventual adviser to consider this (listing) among other options,” Chike-Obi said. He said in April that all three rescued banks were now profitable.

Previously, AMCON said that more than 20 firms — banks and private equity investors — had expressed interest in acquiring the nationalised lenders, but AMCON is keen to have them valued before starting any negotiations.

It may opt to take them public if it can get a better deal.

The Central Bank of Nigeria (CBN) nationalised three banks changed their names to Mainstreet Bank from Afribank; Enterprise Bank from Spring Bank; Keystone Bank from Bank PHB, for failing to find new investors before a recapitalisation deadline.

The CBN then injected N620 billion into nine banks in 2009, judging that they were dangerously undercapitalised.