The Group Managing Director and Chief Executive Officer of First City Monument Bank (FCMB), Ladi Balogun, has revealed that the bank’s strong growth across key parameters affirms its growing market share, driven significantly by its expanding retail franchise that has triggered consistently, over 50,000 account openings by customers and 20,000 loans disbursement on a monthly basis.
Balogun, who fielded questions from the media in Lagos after the release of the 2014 half year results, equally stated that “the quality of the bank’s earnings is now diversified and robust”.
Specifically, FCMB saw five per cent growth earnings from the first six months of last year despite regulatory policies such as the 75 per cent and 15 per cent cash reserve requirements in public sector and private sector deposits respectively between the 2nd half of 2013 and Q1 of 2014.
Additionally, of note was the hike in the minimum savings rate payable and banks absorbing ATM fees previously incurred by customers.
Consequently, FCMB had to increase cash reserve on which it earned zero interest, from N55 billion as at June 2013 to N145 billion as at June 2014.
Balogun however acknowledged that these measures were desirable for the economy at large and the bank’s customers to help stabilize the exchange rate and also reduce the cost of performing banking transactions.
“The increased patronage is therefore gradually providing compensating income and we should see a much stronger growth in the second half relative to the same period prior year, as we believe things have now settled on the policy front”.
Elaborating on the nature of FCMB’s investment banking under a Holding Company arrangement which the group now operates, Balogun reiterated that investment banking at FCMB is about helping to develop the economy on one hand while increasingly helping to preserve the wealth of the society on the other.
“It is a very client and community focused investment banking business as opposed to a market focused one. Hence we are closely aligned with the government objectives of indigenising the upstream oil industry, eliminating and processing flared gas to support our power generation needs, expanding and fixing our electricity generation and distribution capacity, producing things we currently import (from agricultural produce to refined petroleum and petrochemicals et cetera), and expanding our non-oil exports to help improve our balance of payments.”, Balogun stated.
He further said that the HoldCo structure allows the bank to earn a larger wallet share. “We advise companies on how to raise capital across both the bank market and the capital markets and we can participate in both.
“We saw this recently in the landmark Oando-Conoco Phillips transaction. We can also help individuals pay school fees and invest in long term investment plans to meet future educational expenses for dependents through our investment products.
“We get a complete view of the customer and we are working hard to ensure we become more relevant and helpful. FCMB Group is also home to one of Nigeria’s leading stockbroking firms, CSL Stockbrokers that is at the vanguard of directing investment, local and internal, into the Nigerian capital markets.
Balogun emphasised that FCMB is expanding its asset management business, because “we recognize that as prosperity increases in Nigeria (and Nigeria offers some of the best growth opportunities), as much of that prosperity as possible should be reinvested safely and professionally in Nigeria.
“Hence our investment banking business is really about creating a more prosperous economy and in so doing, we will create value for our shareholders”.
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