Access Bank Launches an Ambitious 5 Year Plan to be Number 1

This week Access Bank, led by the Group Managing Director, Herbert Wigwe presented a medium term growth economic framework to become the Number 1 Bank in Nigeria by the Year 2022. The Bank recorded net revenues of 273bn in 2016 with a compounded annual growth rate improvement of 42%  from the previous financial year. Its profit before tax was 90bn while its Return on Equity came out at 17% with Capital Adequacy Ratio at 21%.

The Bank is projecting that it will acquire as clients 80 of the 100 largest Corporate Organizations in Nigeria by the Year 2022, raising its current 7m retail customers to 14m and 230k SME Clients to 460k. Its projecting that by the Year 2022, its Compounded Annual Growth Rate will rise by 11.3% to $16.4bn in Nigeria, by 7.4% to $26.7bn in Republic of South Africa. It says its Nigerian Growth will be predicated on strong fundamentals like:

  • Doubling of its retail base from 7m to 14m by 2020
  • Digitization of payments by the Federal Government
  • Low SME lending penetration less than 1% of Credit
  • New Industries from Economic Diversification with Import Substitution, Power Generation & Distribution
  • Increasing Regionalization of Corporates
  • Increased regulation for the financial services sector

The Bank says it has identified 8 Strategic Levers for Wholesale Banking & 13 Strategic Levers for Retail Banking,

Growth Levers:

  • Acquire 80 of the 100 top Corporate Portfolios in Nigeria
  • In Commercial Banking, Increase focus on Key Regions with Bankable Revenues
  • Increase share of revenues from asset light products across Wholesale Banking
  • Build deep sector expertise in priority industries to unlock and capture increased revenue opportunities across Wholesale Banking

Enablers:

  • Move to a more client centric coverage model by adopting a CST model for corporate clients and tiering methodology for commercial
  • Launch a sales force effectiveness program across Wholesale Banking to embed best practice tools and routines
  • “Credit Machine” optimization
  • Improve customer centricity through digital and advanced analytics

Access Bank was given a banking license in 1989 in the same year as Guaranty Trust & Zenith Bank. It has grown steadily over the years. Today its a the number 5 bank in terms of number of branches, number three in terms of PoS machines, and number 1 in terms of ATM Machines deployed around Nigeria. The Bank was founded by Aig Imhoukede who was CEO until 2012 and finished s the immediate past President of the Council of the Nigeria Stock Exchange. The Board of the Bank is Chaired by a woman, Mrs. Mosun Bello Olusoga

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Kelvin Emmanuel

About Kelvin Emmanuel

The Oil producing Angola in the Southern part of Africa faces what Nigeria faced 12months ago; a distortion in its exchange rate with a difference between the official markets and the parallel black markets. One dollar through the official window buys you 166 kwanza, while one dollar through the black market buys you 400 kwanza. Nigeria faced the same challenge 12months ago, when the distortion between the official and black markets was as much as the official markets trading at 306 with the parallel market ranging from 450 through to 510. The Central Bank Governor of Angola, Jose de Massano Junior announced in Luanda “We will stop having a fixed foreign exchange, we will adopt a floating regime of foreign exchange”. Angola faces exactly the same challenges and has been applying the exact same responses to an exchange rate crisis like using its foreign reserves that was sitting at $26bn to defend the currency kwanza, with no success so far, even though the external reserves has dropped to $14bn. Angola relies on Oil receipts for 80% of its government revenue, 90% of its inflow and 50% of its GDP. Angola is a $194bn economy that has been growing at an average of 10% on the back of rising oil prices since 2002 when its 27 year old civil war that started in 1975 ended. The state national oil company Sonangol reports that it produces up to 1.8m barrels of crude oil daily, however the government that until now has being led by the family dynasty Jose Eduardo dos Santos until recently when succession saw power transferred to Joao Lourenco, reports that the oil price rout in 2015/2016 that saw prices drop to as low as $28 per barrel caused ripples across the economic structures of the government, upsetting government revenues, its ability to fund its budget, capital project funding, foreign direct investments into the economy as a result of a currency crisis that was driven by the widening of gap between the official and street window of the kwanza, that until now has been pegged in a fixed exchange rate regime to the US Dollar.