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Wema Bank targets N1 trillion capital base

By Clara Nwachukwu (Business Editor)
18 April 2019   |   4:20 am
Buoyed by its 2018 financials and performance in which it prescribed the payment of 3kobo dividend per share for the first time in 15 years...

.Mulls M&A, expansion to other retail segments
Buoyed by its 2018 financials and performance in which it prescribed the payment of 3kobo dividend per share for the first time in 15 years, the management of Wema Bank Plc has said it is targeting a trillion naira asset base over the next few years, while expanding its tentacles in other retail segments.

Areas of interest to the bank include downstream oil and gas, where many a banks got their fingers burnt in the past, specific agriculture value chain, and the small and medium enterprises (SMEs) space, where it plans to churn out tailor-made products to meet customer needs.

Revealing more of the plans in Lagos, Tuesday, the bank’s Group Managing Director/Chief Executive Officer, Ademola Adebise, told journalists specifically that by 2020, the management hopes to double key indices including assets, deposits, profits and more.

These, he believes, will prepare the bank to consider opportunities in the mergers and acquisition space, even as he refused to be drawn into specifics on whether there are already ongoing talks with prospects.
He rather clarified: “There are two ways to grow – you grow organically or you grow inorganically. What we are saying is that in the next two years, we want to double our indices through organic growth. Afterwards, if there are opportunities for M&A we will consider it.

“M&As are created by opportunities, it’s not that you will go and submit yourself to M&A. today, we are in the neighbourhood of N400billion in assets, so we will be shooting for about N800billion by the time we double that. We want to get into the trillion naira mark in terms of asset base, and not that we will get there through M&A.”
Furthermore, the bank plans to leverage on technology, notwithstanding the high cost, to achieve set targets, while also cutting operation costs.

Adebise said: “During the tenure of the former MD, Mr. Segun Oketuyi, we started to strategically take the bank out of the woods; the first thing we did was to address the liquidity situation or what we called stabilising the bank, and the next phase was to put in place building blocks, and the last phase that we’re in now, is growing the bank. Basically, it has been a tough, but exciting journey.

“Last year, saw the bank declaring dividend for the first time in 15 years. The last time was in the era of Mr Tunde Lemo, also a former CBN Deputy Governor. We see this as a demonstration of all the efforts of management over the last nine years, which culminated in the payment of dividend.

“From here, we intend to be a strong retail bank, leveraging technology and innovation. Also, the next two years, we will try to double our key indices including assets, deposits, profits etc, and to play big in the retail segment. At the end of the day by 2020, we would have doubled our numbers. By this, we would then embark on opportunities in M&A for inorganic growth.

“We have key sectors of the economy that we have mapped out to achieve this growth. Also, we are trying to ensure that we have well-trained and well-motivated staff that will also be well-remunerated.”
When noted that increasing adoption of technology may lead to the sacking of some staff, Adebise insisted that this is not necessarily so, because Wema Bank has what he describes as “a clear digital journey, which involves various business models.”

He argued that business models are changing on account of technology innovations, as such, companies must learn how to maximise these for value addition.