FCMB: Focusing on specifics to extend financial services
OVER the years, the financial services industry in Nigeria has undergone various forms of transformation in terms of operations, service delivery and other indices of performance. Increased sophistication in the lifestyle of people, changing tastes, demanding schedules, technological savviness, amongst other modern trends, have seen operators in the sector constantly reinventing the wheel to meet and satisfy the needs of the ever-dynamic environment as well as the populace.
These days, the assessment of financial institutions, particularly banks, is largely measured by their level of connection with their stakeholders and the customer-centric solutions they offer. This fact was succinctly captured by Roy Spence, co-founder of GSD&M, a leading advertising firm in the United States, who declared that, “every business needs to be in the business of improving customers’ lives.”
For FCMB Group Plc, a foremost holding company in Nigeria, its nine subsidiaries which are leaders in their respective segments, this declaration underlies the philosophy; serving as a roadmap in the firms’ drive to attain the highest levels of customer advocacy as well as experience. This is while also adding significant value to stakeholders. The operating companies of FCMB Group, with Mr. Ladi Balogun as the Group Chief Executive, are divided along three business groups–Commercial and Retail Banking (First City Monument Bank Limited, Credit Direct Limited, FCMB (UK) Limited and FCMB Microfinance Bank Limited); Investment Banking (FCMB Capital Markets Limited and CSL Stockbrokers Limited); and Asset & Wealth Management (FCMB Pensions Limited, First City Asset Management Limited and CSL Trustees Limited).
Having witnessed low and high moments in its many years of operation, the Group has continuously turned challenges to opportunities over the years to emerge as one of the leading institutions in corporate Nigeria. This underpins the resilience, endurance, robustness and viability of the brand to sustainably deliver exceptional financial services to individuals, groups and organisations across segments. Indeed, the performance of FCMB has been on the uptick. And there is no gainsaying the fact FCMB has proved its mettle as an inclusive lender by being a big player in all sectors of the Nigerian economy. The enduring establishments are transferring prosperity by impacting on businesses and individual aspirations
The Group successfully acquired Legacy Pension Managers Limited (now known as FCMB Pensions Limited) by increasing its stake in the company from 28.3 per cent to 91.6 per cent. The development is engendering sustainable and diversified low-risk growth momentum as the pensions firm is leveraging FCMB’s extensive distribution network, alternate channels, digital innovation and investment research to rapidly expand its customer base.
Speaking on the acquisition, Chairman of the Board of FCMB Pensions Limited and the Group Chief Executive of FCMB Group Plc, Mr. Ladi Balogun, said, “having distinguished ourselves in consumer finance over the years and gaining greater market share in retail payments solutions and savings accounts, a comprehensive suite of asset and wealth management propositions, is a natural addition to our growing base of five million customers. We have now harmonised the brand. This will enable us create greater marketing synergies alongside other initiatives and accelerate the growth of our pensions business. The change of the company’s name will also entrench a single brand identity across our pensions and retail banking businesses”.
Meanwhile the financial results of FCMB Group for the nine months ended September 2018 showed a significant increase in profit before tax to N14.77 billion, as against N6.84 billion recorded for the same period in 2017. Also, gross revenue rose by 11 per cent to N132.9 billion from N118.8 billion. Net interest income witnessed a seven per cent Year-on-Year (YoY) upsurge from N49.9 billion to N53.2 billion, just as non-interest income grew by 77 per cent (YoY) to N33.0 billion from N18.6 billion for the same period in the previous year.
Customer confidence in FCMB Group remained strong, as deposits were up five per cent Quarter-on Quarter (QoQ) to N756 billion in September 2018, compared to N721.3 billion at the end of June 2018. In addition, the nine months financial results saw a surge in loans and advances by three per cent QoQ to N601.9 billion in September 2018 as against N586.0 billion in June 2018, which is an indication of the Group’s aggressive focus on financial intermediation and support for economic growth of the public and private sectors. The impact of the subsidiaries on the overall performance of FCMB Group has been profound as evidenced by their solid performance.
First City Monument Bank (FCMB), the retail and commercial banking-led subsidiary of FCMB Group Plc, has consolidated its position as a dominant brand by growing in leaps and bounds. The bank has continued to boost its customers acquisition drive in the retail segment of the banking industry. It has also sustained the tempo of becoming a more convenient and accessible bank in alternate channels, with more than 800 Automated Teller Machines (ATMs) spread across Nigeria as at the end of 2018 and over 15,000 Point of Sale (PoS) terminals deployed nationwide, while on-boarding almost two million customers on its electronic banking platforms. Added to these, is the strategic location of the bank’s business outlets (branches and alternate channels) nationwide; providing prompt and convenient banking solutions as well as promoting financial inclusion in line with its values as a simple, reliable and helpful entity. So far, FCMB has 216 branches and cash centres in Nigeria
The bank has sustained the empowerment of customers through its reward scheme tagged, “FCMB Millionaire Promo”. Almost 50,000 customers have benefitted from the promo by winning cars, cash rewards of between N1 million and N2 million as well as gifts like television sets, power generating sets and phones, among others.
In business banking, Small and Medium Scale Enterprises (SMEs), FCMB recorded a significant improvement in net revenue as at the end of 2018. FCMB offers several cutting-edge products, services and solutions to meet and satisfy the needs of businesses in this segment. The lender has recently disbursed over N3.17 billion to SMEs across the country under the Central Bank of Nigeria (CBN) intervention programme. The bank also offers free banking transactions for a period of three months to new to FCMB SME customers as well as free training and other capacity training programmes for businesses operating in this segment in partnership with private and public sector organisations, including the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN). Plans are also underway by FCMB to launch a proposition that offers zero-interest rate on loans to women-owned SMEs.
Between June and October last year, the lender organised a promotion tagged, “FCMB SME Race to China Promo” for customers. Three winners of the star prize of an all-expense paid trip (return flight ticket to Guangzhou, China and hotel accommodation for seven nights), eight winners of $500 preloaded shopping cards and 36 winners of consolation gifts have emerged and have been rewarded.
In agribusiness, FCMB recently signed a Memorandum of Understanding with the World Savings and Retail Banking Institute (WSBI) in a move that would substantially increase the bank’s support to agribusiness, its value chain and overall growth of the Nigerian economy. The memorandum outlines a framework to deepen agency banking, financial inclusion and savings culture in the informal and agribusiness sectors. The project involves FCMB rolling out an integrated savings account – named Kampe Account – to offer financial services under phase one of its plan to 150,000 unbanked and under-banked farmers across five states through agricultural agents operating under the bank’s agency banking proposition. The first set of states to benefit in this first phase are Kaduna, Kano, Nasarawa, Ogun and Oyo. The plan is to reach two million farmers across the entire nation by year 2023.
In addition to the financial support to farmers, FCMB is deploying its state-of-the art technology and mobilising banking solutions to drive the project mainly in the rural and sub-urban farm settlements where most farmers are based. The bank is organising capacity-building programmes for farmers, aimed at facilitating their understanding of the sector and promoting innovative ideas to make the sector more attractive, thereby facilitating job creation and in turn, impacting on productivity and income generation.
With regards to corporate banking business, the renewed liability and transaction driven approach of FCMB has seen the lender fund several projects aimed at growing the Nigerian economy. In the oil and gas sector, the bank was the major financier of the 300 million litres tank farm of Petrolex Oil and Gas Limited, located at Ibefun town in Ogun state, which was commissioned in December 2017. The lender also provided the funds for the construction of the 66,000 metric tonnes capacity petroleum products tank farm of Menj Oil Limited in Ijegun, Lagos.
Moreover, FCMB wholly financed the construction of the new 155-room Radisson Blu Hotel at Ikeja GRA in Lagos. The Radisson Blu Hotel in Lagos, which is the third in Nigeria and second in Lagos, was opened in 2018.
Speaking on these developments and the outlook for the year 2019, the Managing Director of FCMB, Mr. Adam Nuru says, the bank has a great foundation to continue to build on and being confident of its strategy, will achieve the necessary resilience.
“We know we will need constant change, innovation capability and high productivity to thrive in a progressively fierce competitive environment. Based on this, we have a renewed strong commitment to our digital transformation journey with aggressive investments in putting the right structures in place. This is expected to facilitate efficiency in our operations and fuel our efforts to create the right momentum; expand our share of the market and increase our wallet-share of existing customers. We will leverage our digital capabilities to reduce our cost-to-serve; grow non-interest income; and improve our agility as a bank to deepen intimacy with our customers”, he stated.
With this outstanding moves and achievements, coupled with the bank’s niche for excellence and a clear understanding of its market and the environment, it is believed that the FCMB brand is well positioned to create more value for its growing customer base and other stakeholders in Nigeria.