Fortis Microfinance Bank's Presentation to the Nigerian Stock Exchange


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Fortis Microfinance Bank's Presentation to the Nigerian Stock Exchange

  1. 1. INTRODUCTION This presentation will show: WHO WE ARE - Introduce Fortis Microfinance Bank Plc to the Nigerian Stock Exchange, Stock Brokers and the general Investing Public. WHAT WE DO - Discuss our organization, operating structure and financial performance in the last 4 years; WHAT IS POSSIBLE? - Discuss the Global Picture of Microfinance banking with possibilities in Nigeria; and present Business, Performance and Expansion Strategies of the Bank.
  2. 2. ABOUT US
  3. 3. QUICK FACTS  We laid a solid foundation in 4 years  We carved a niche for our brand  We gained regulatory confidence  We gained customers’ confidence  We dominated the Microfinance Scene  We set the pace for Microfinancing
  5. 5. CORPORATE HISTORY 2011 - 2012 VISIBILITY, GROWTH & 2009 - 2010 QUEST FOR DOMINANCE MARKET RECOGNITION Expanded Branch channels to 14. 2007 - 2009 Fortis MFBank expands its Consolidated reach through Microcredit base to the THE BEGINNING hinterlands & rural areas. 19 business units. 2005 - 2007 Fortis MFBank obtains its Increased Branch network Cross 100,000 customer license on 4th October to 11 within Abuja FCT. baseTHE OPPORTUNITY 2007. Obtained CBN’s clean bill Became the onlyIntroduction of Fortis MFBank Microfinance Bank withMicrofinancing in the of health as 224 MFBs lose commences operations for their licenses. affiliate company that got aNigerian Banking Sector. business on 22nd October mobile payment license as 2007. Partnered with SMC issued by the CBN.Licensing of about 150Microfinance Banks. Cooperative to drive Established a well Financial inclusion. Converts status from a positioned, amazing Limited company to aConversion of Community customer service driven Public Limited company.Banks to Microfinance Gained strong Market institution focused on share in all viable businessbanks. professionalism, sound Over N10.2 Billion segments in the ethics and integrity. Microfinance space. disbursed to MSMEs inUnbundling of the Informal Abuja.Financial Services Initiated a microfinanceplatform. academy certified by the CBN to provideDimensioning an entrepreneurialunderserved market management and financialsegment. literacy.
  6. 6. THE BOARD FELIX ACHIBIRI CHAIRMANFelix Achibiri is an entrepreneur with over 16 years of cumulative experience in Business Development & Strategy. He holds adegree in Management Science from University of Port Harcourt.He is the Managing Director/CEO of Rural Steel Bridging Limited, a company specializing in the supply and construction ofmodular bridges in Nigeria with technical support from Messrs Mabey and Johnson UK. He sits on the boards of severalcompanies including Securiport Nigeria Limited, a member of Securiport LLC, Washington DC; USA, Lloyds Energy Limited andAfrican Green Projects Limited.He is widely travelled and has attended several international professional courses, exhibition and workshops. Mr. Achibiri bringshis unwavering strength in identifying opportunities, making the right connection and building relationships for actualization of setbusiness goals. KUNLE OKETIKUN MD/CEOKunle Oketikun has over 20 years experience in Banking. He has competencies acquired in senior positions within Retail,Corporate and Investment Banking from Standard Trust Bank (Now UBA), Lead bank Plc and Ecobank Nig Plc.Prior to Fortis, he was responsible for Ecobank’s branches in Abuja and the Northern states. He was the pioneer ExecutiveDirector, Operations and Risk Management in Fortis Microfinance Bank, before being appointed Managing Director/CEO. Heholds a Masters Degree in Banking and Finance and is an Associate member of various professional associations including theChartered Institute of Bankers of Nigeria (HCIB), Institute of Cost Management (ICM) and Chartered Institute of Management(ACIM).He is widely travelled and has attended several training programs, both local and International in various aspects of Banking andLeadership. He has been exposed to diverse microfinance training including International Labour Organization (ILO) and FordFoundation supported trainings on “Making Microfinance Work” as well the Central Bank of Nigeria (CBN) organized “CapacityBuilding Training” for Operators of Microfinance Banks in Nigeria.He attended the CBN|NDIC|CIBN recently instituted Microfinance Certified Professional training and examination for all MD’s andtop executive of licensed microfinance bank in Nigeria where he bagged the MCIB certification.
  7. 7. THE BOARD DEJI FISHO DIRECTORDeji Fisho is a graduate of Business Administration and holds an MBA from Ahmadu Bello University, Zaria. He holdsseveral diplomas and has attended key seminars locally and internationally. Deji started his banking career in 1992, andhas had requisite and management training from banks including UBA, Citizen Bank (now Spring Bank) and Ecobank.His professional memberships include the Chartered Institute of Bankers of Nigeria (CIBN), Institute for FraudManagement and Control, Institute of Capital Market Registrars (ICMR) and Risk Management Association of Nigeria(RIMAN). Other memberships include Abuja Chamber of Commerce, Industry, Mines & Agriculture (ABUCCIMA) andAbuja Literary Society.He is a consultant to organizations including the British Council, Department for Foreign Development (DFID), theNational Hospital Abuja, etc. His consulting competencies cover Business Transformation, Policy, Finance andStrategy.He is an unrelenting entrepreneur and has been actively involved in the initiation and management of severalbusinesses traversing finance, education, insurance, health & hospitality, auto sales & servicing, IT and assetmanagement.Deji Fisho is an author and he currently contributes articles to both local and international journals and magazines. Hehas a passion for Youth Empowerment, National Integration, mentoring young people, Community Development andBuilding Bridges. He is a change driver and is involved in Transformation programmes across Nigeria. He speakswidely on J U M A U Sethics, N D A N entrepreneurship, M A leadership andI businessO R D R E C T transformation.A seasoned banker with over 22years hands on banking experience acquired in senior managerial positions. Hasbusiness interests spanning banking, transportation, insurance and real estate. He is happily married with two children.
  8. 8. THE BOARD H E N R Y N W AW U B A DIRECTORHenry Nwawuba holds a Masters of Science Degree in Business Computing from the University of Westminster. He ishighly skilled in computer programming within the Windows environment, MS SQL Server 7.0, Unix Solaris, and Oracle8i.He has extensive business experience in start up businesses and promoting entrepreneurship and has been theManaging Director of NICNOC Nigeria Limited, Brook Tree Limited etc. He has has been in management positions inorganizations like Colt Telecoms Europe, One-2-One UK, and SITEL Communication, UK.His objective is to expand knowledge of Business processes and develop entrepreneurial skills of Small and MediumScale (SME) operators. DAN ESSAI DIRECTORHe is a seasoned entrepreneur whose career in both the public and private sector spans over (3) three decades.He holds a Masters degree M.ED (Administration and planning) from University of Jos. His career is boosted with - aCertificate of Proficiency in Legislative Processes from Legislative 50 Denver – Colorado; Advanced ManagementCourses (AMC) at Ascon, Badagry, Advanced Financial Management Course (AFMC) at Ascon Badagry to mention buta few.His wealth of experience was garnered in the State and Federal Civil Service where he worked in various capacitiesover three (3) decades before retiring as a Director in 2009. He is widely travelled.
  9. 9. MANAGEMENT TEAMKUNLE OKETIKUN - CHIEF EXECUTIVE OFFICERKunle Oketikun has over 20 years experience in Banking. He has competencies acquired in senior positions within Retail, Corporate andInvestment Banking from Standard Trust Bank (Now UBA), Lead bank Plc and Ecobank Nig Plc.Prior to Fortis, he was responsible for Ecobank’s branches in Abuja and the Northern states. He was the pioneer Executive Director, Operationsand Risk Management in Fortis Microfinance Bank, before being appointed Managing Director/CEO. He holds a Masters Degree in Banking andFinance and is an Associate member of various professional associations including the Chartered Institute of Bankers of Nigeria (HCIB), Instituteof Cost Management (ICM) and Chartered Institute of Management (ACIM).He is widely travelled and has attended several training programs, both local and International in various aspects of Banking and Leadership. Hehas been exposed to diverse microfinance training including International Labour Organization (ILO) and Ford Foundation supported trainings on“Making Microfinance Work” as well the Central Bank of Nigeria (CBN) organized “Capacity Building Training” for Operators of Microfinance Banksin Nigeria.He attended the CBN, NDIC, CIBN recently instituted Microfinance Certified Professional training and examination for all MD’s and top executiveof licensed microfinance bank in Nigeria where he bagged the MCIB certification.JERO OMARE-OGAH - CHIEF STRATEGY & IMPLEMENTATION OFFICERJero Omare-Ogah holds a Bachelor’s degree in Economics and an MBA with focus on Business Analysis and Development.He is highly skilled in Credit Management and Analysis, Business Planning and Strategy, Service Quality Management, Lean Six SigmaMethodologies, Organizational Alignment, Investment Management, Financial Budgeting and Forecasting. His professional experience spansdiverse fields as Business Process Re-Engineering, Project and Program Management, Customer Service and Strategic Planning.He was with Nof-Techno Commerce as a Business Manager before Diamond Bank Plc, where he worked for 7 years in various capacities withinthe operations and Technology division. He was a management consultant with Dolce & Yomario Consulting as National coordinator before FortisMicrofinance Bank Plc where he started out as Head, Bank-wide Customer Services.He has attended several executive courses in and outside the country. He is a CBN-certified Microfinance Practitioner, an associate member ofChartered Institute of Economists and the Nigerian Institute of management.He is a member of the Project Management Institute, (PMI) Philadelphia USA and the International Institute for Business Analysis, Canada.
  10. 10. MANAGEMENT TEAMF E M I B O B A D E - CHIEF FINANCE OFFICERFemi Bobade is a Chartered Accountant with a Bachelor of Science Degree in Economics from the Obafemi Awolowo University, Ile Ife.He worked with Ibrahim Yusuf and Co. (Chartered Accountants) for 16 years where he audited high profile accounts including and not limited tothe Federal College Kano, United Nations Development Programmes in Borno, Yobe, Bauchi, Adamawa, Taraba and Gombe State, KadunaAgricultural Development Programme (KADP) Kaduna, and United Nations Development Programmes under National Execution.He was a consultant on World Bank Water Projects and the UK-Department for International Development.He brings his vast experience in designing and implementing Accounting systems, external audit, internal and fraud control and specializedauditing to FortisMFB Plc. where he serves as the Chief Financial Officer.WANDOO AIBANGBEE - CHIEF LEGAL OFFICERWandoo Aibangbee has a Bachelor of Law from the University of Abuja and a Masters in Petroleum Law and Policy from the University of DundeeScotland. She is a chartered Mediator.She worked with Corona Energy Limited, London from 2005-2007 and was in charge of Portfolio Administration, Analysis, Forecasting andPerformance Quantification. She has had some work experience with J.K Gadzama SAN and Co as a Legal Officer with responsibility for LegalAdvisory Services, Litigation, Drafting and Negotiating Agreements and Research.Her duties in this role includes ensuring legal processes are in place and the interest of the organization is protected to avoid liabilities. She alsorecommends counsel and provides legal support to the Bank.M A U R E E N I M U E K E M H E - CHIEF HUMAN CAPITAL OFFICERMaureen Imuekemhe holds a Post Graduate Diploma in Management and has over 12 years experience covering Administration and HumanResources Management.She worked as Admin and Personnel Manager for Top View Hotel and later as a consultant. She is skilled in recruitment and capacity building.
  11. 11. MANAGEMENT TEAMR AJ I M U S TAP H A - CHIEF RISK OFFICERRaji Mustapha has a Bachelor of Science Degree in Accounting and a Masters Degree in Business Administration from Ahmadu Bello University,Zaria.He was a senior credit staff in Prudent Bank (now Skye Bank) and at the defunct Liberty Bank Plc, Abuja. He has experience in the Manufacturingsector and was an Accounting Manager, Cement Company of Northern Nigeria, Sokoto.He has extensive experience in Credit Administration which he brings to Fortis Microfinance Bank Plc. He is responsible for formulating the bank’sloan policies in line with the bank’s credit manual, financial position, demand and profitability. He ensures high quality assets, minimizes financiallosses from credit and other risk exposures.UCHE OKOLIE - CHIEF TREASURY OFFICERUche Okolie holds a BSc in Pharmacology from the University of East London and a Masters degree in Financial Management from MiddlesexUniversity, London.She began her career in London at Sainsbury’s Plc. where she was an Assistant Human Resource Manager. She rose through the rungs tobecome the Head Human Resource Manager. She was Group Payroll Manager at Hays Accountancy, London. She was recruited as a MarketIntelligence Officer for Fortis Microfinance Bank and later appointed Head Treasury.She has participated in many workshops on Financial Management, Treasury and Inter-bank relationship. She recently concluded theCIBN|CBN|NDIC compulsory certification program for practitioners of microfinancing in Nigeria.ANTHONY ARIMORO - CHIEF INTERNAL CONTROL OFFICERAnthony Arimoro is a Chartered accountant with a Bachelor of Science Degree in Accounting. He has over 8 years experience covering both thefinancial and education sector.He is skilled in Audit, Design of internal control and Accounting systems. He started with Fortis as an Internal Control officer in 2010 and waslater appointed Chief Internal Control Officer.
  12. 12. MANAGEMENT TEAMABIODUN ADEWUMI - CHIEF PERFORMANCE MONITORING AND MEASUREMENTS OFFICERAbiodun Adewumi is a Chartered Accountant with a Higher National Diploma in Accounting from Yaba College of Technology, Lagos.He is also a Member of the Nigerian Institute of Management NIM), and Information Security Audit and Control Association, USA (ISACA). Heworked as a Control/ Compliance Monitoring Officer, Business Office Auditor with United Bank for Africa Plc (UBA) .He was the company Accountant at Hedgeworth Ltd, Abuja, where he coordinated the financial activities of the company.He has attended several trainings and seminars including; Technology Competence Initiative by the Chartered Accountants of Nigeria (ICAN).He is skilled at Taxation and Fiscal Policy, Strategic Financial Management, Financial Reporting and Audit Practices and Public SectorAccounting.CHUKS OJEIFO - COORDINATOR FORTIS ACADEMYChuks Ojeifo is a CBN and World Bank certified Microfinance Trainer and holds a Masters Degree in Project Management. He also has expertisein microfinance management, entrepreneurship and human capacity development.He is versatile in developing and delivering training courses in microfinance, entrepreneurship, value chain development, leadership, informationand communication technology, management and others.He has been a resource person in entrepreneurship development, microfinance, leadership and management courses for over 7 years. He hasattended several businesses capacity development training programmes organised by ITC-ILO –UNDP, CMD, ADBI-World Bank, Lagos BusinessSchool, KPMG, SEDPI ATENEO DE MANILA University – Philippines along with CBN and NDIC, Oracle IMN etc.He developed extensive consulting skills while in the management teams of Michael Jacobs Consulting, MTEL and JK Consulting before joiningFortis Academy. Chuks currently heads Fortis Academy Ltd.
  13. 13. THE FUTURE Microfinancing is the future and is key to rejuvenating the Nigerian economy.
  14. 14. AN EMERGING MARKET  Income gaps have increased over the last generation, with more poor people today than ever before- opportunities | Ready made markets.  Microfinancing as a whole has remained stable worldwide during the last financial markets crisis.  Credit demand in developing countries including Nigeria remains largely unfulfilled.
  15. 15. MICROFINANCING IN NIGERIA  The myth about the people’s inability to save and repay loans has been broken.  Microfinancing market is ripe and untapped.  Huge market - More than 70% of Nigerians (& 60% of the world) are classified as economically disadvantaged – this means about 100m Nigerians to be served by Microfinance Banks with products.  Keen competition, thinning profit margin & slow growth rates of corporate & commercial banking institutions  World Bodies, Governments, Multilateral Agencies and others are focusing on this as a tool for poverty reduction
  16. 16. PERFORMANCE INDICES OFMICROFINANCING MicroVest, USA reported that 150-200 microfinance institutions worldwide were financially self-sufficient. They had loan portfolio of approximately $3.5 billion. (1) Profit margins on their portfolios were as high as 21.8%. 12 out of the 29 microfinance institutions rated in Latin America in 2006, were (1) consistently more profitable than Citigroup. The most profitable microfinance institution had a Return-on-Equity (ROE) of (1) 42.9%, compared to Citigroups 19.7%. World average microfinance on-time repayment rates hovers around 98%, much higher than the commercial banking industrys average. Profitability arises from attractive interest rate normally charged on microfinance loans and high repayment rates. (1) - SOURCE: MICROVEST YEAR 2006 REPORT
  18. 18. Interest Income Gross Earnings600 900 567.88 830.35 800500 700400 600 516.46 312.61 500300 394.06 400 212.77200 300 97.13 200 177.76100 100 0 0 2008 2009 2010 2011 2008 2009 2010 2011
  19. 19. Net Assets Balance Sheet Size 4,718.62 792.63 3,315.55 493.35 2,466.22 1,098.0039.89 45.522008 2009 2010 2011 2008 2009 2010 2011
  20. 20. Shareholders’ Fund1,000.00 850.86 800.00 600.00 493.36 400.00 200.00 45.52 - 2008 FY 2009 FY 2010 FY 2011 FY(200.00) (54.87)(400.00)
  21. 21. Depositors Funds 4,736.98 4,147.40 3,691.79 2,769.53 2,392.46 2,446.76 2,326.98 1,589.37909.02DEC 2008 DEC 2009 DEC 2010 1ST QTR 11 2ND QTR 11 3rd QTR 11 4th QTR 11 1ST QTR 12 MAY 2012
  23. 23. Net Income 3,120.20 2,418.76 1,875.01 1,536.891,024.592012 2013 2014 2015 2016
  24. 24. Total Assets Projection Net Assets Projection 5,621.52 49,640.48 4,772.05 38,947.84 3,598.81 32,621.63 4,122.71 3,176.04 21,087.2618,499.85 2012 2013 2014 2015 2016
  25. 25. Earnings Per Share (EPS)2016 9.302015 7.602014 6.002013 4.902012 4.10 - 2.00 4.00 6.00 8.00 10.00
  26. 26. Shareholders’ Fund6,000.005,000.004,000.00 5,621.523,000.00 4,772.05 3,176.04 4,122.71 3,598.812,000.001,000.00 - 2012 2013 2014 2015 2016
  27. 27. DEPOSITORS FUNDS PROJECTIONS 105,000.00 65,000.00Million 43,000.00 25,000.00 12,000.00 2012 2013 2014 2015 2016
  29. 29. STRATEGIC OBJECTIVES Maintain the Fortis brand as the unique and foremost Microfinance Bank; driven by passion for innovation, creative solutions, amazing customer service and leveraging on technology whilst creating optimum value for all stakeholders Maintain our pre-eminent position Expand aggressively and as market leaders in Nigeria. Strategically in concentric circles around key regions around Nigeria  Focus on creating a brand identified  Effectively expand existing operations by for amazing customer service. exploiting various distribution channels.  Deepen and Broaden relationship s  Enhance processes and structures to with Microcredit, SMEs and our retail improve operational efficiencies and exceed client base for greater outreach and customer expectations. impact.  Standardize and Improve cross-selling of  Continuous and never-ending existing products and create new innovative improvement in Innovation and products to meet emerging needs. process automation leveraging on cutting-edge technology.
  30. 30. IMPERATIVES  To become the dominant player in the Nigerian Microfinance industry. Our Strategic  To be specifically amongst the top 3 in Africa in the Microfinance Goals space in terms of Assets and ROE by year 2015  Continue to be recognized as the preferred Microfinance bank for customers who seek real value and support. Increase market share in growth sectors: - MSMEs, Agriculture, Trade and Micro housing. How? Continuous branch expansion in viable and strategic locations. Develop liability-end of retail banking business, through aggressive marketing and attracting grants and developmental funds. Leverage on cutting-edge technology to deliver “anywhere, anytime, multiple channel banking” (24/7). Create strategic partnerships and alliances. Establish dominance in creating innovative cradle-to-retirement products. Deploy requisite technology to manage costs effectively.
  31. 31. A MARKET YETUNEXPLORED  61% of urban and 86% of rural of the population are currently unbanked  N1.2 trillion in circulation and unbanked
  32. 32. PROPOSED OUTREACH IN 12 MONTHSTop 5 states by GDPTaken as a whole, the 36 states in Nigeria account for $288Billion in GDP. This figure excludes economic activities within theinformal sector. More than a third of these economic activities are generated within just five states (Lagos, Rivers, Delta, Oyo andImo). GDP (in $Billions) Imo 14.2 Delta 16.7 GDP (in Lagos 37.6 $Billions) Oyo 16.1 Rivers 21 Population (in Millions) Population Port Harcourt 1053 Kaduna 1458 Ibadan 3078 Kano 3248 Lagos 8029 Top 5 Cities by PopulationSOURCE:NIGERIAN BUREAU OF STATISTICS The top five cities in Nigeria have a combined population in excess of 29 million. Our strategic expansion will involve going into states with strong compelling needs for microfinance services.
  34. 34. EXPANSION PLANSSecondary Equity offering to enhance competitive advantage and ensure better asset-liability matching. KEY FEATURES SIZE TENOR CURRENCY LISTING N 2 Billion NIL Naira Nigerian Stock Exchange USE OF PROCEEDS - To increase working capital - To acquire a National License - To increase branch network - To enhance the our infrastructure
  35. 35. EXPANSION PLANSBond offering to enhance competitive advantage and ensure better asset-liability matching. KEY FEATURES SIZE TENOR CURRENCY LISTING N 5 Billion 5 years Naira Nigerian Stock Exchange USE OF PROCEEDS - Further increase our working capital - To fund promotion of micro housing.
  36. 36. QUICK FACTS ON MFBS IN OTHER CLIMESNMB is one of the largest commercial banks in Tanzania, with a total assetvaluation of about US$1.4 billion (TZS:2.17 trillion) as of December, 2011. Thebanks shareholders equity was valued at approximately US$184million(TZS:284.4 billion).The stock of the bank is listed on the Dar -es - SalaamStock Exchange.Equity Bank was voted the Best bank in Kenya and also for Bestinitiative in support of SMEs and the Millennium Development Goals inAfrica during the annual African Investor Index Awards held in 2011.The bank is the fastest-growing financial service organization in EastAfrica with an estimated asset base of over US$1.3 billion as of March2009.SKS Microfinance is the largest MFI in India in terms of number ofborrowers, number of branches and total loans as of September 30,2008, In November 2008 SKS raised equity worth $ 75 million (N11.7Billion) the largest equity raised by an MFI in the world. Branches 2488  Loans disbursed $6.7billion Staff strength 25,157  Recovery rate 98.8% Borrowers 7.4M  Coverage 80,949 villages
  37. 37. MICROFINANCE BANKING Different levels of maturity today - promising perspective for tomorrow
  38. 38. THE FORTIS EDGE INFORMATION UNPARALLELED OUR PEOPLE TECHNOLOGY SERVICE  Highly motivated  Strategic Investment  Amazing Customer in ICT Service  Highly Intellectual  New Product Designs  Interesting Microfinance  Stable Management Landscape  Market Dominance  Effective Corporate  Strong Presence in the Governance  E-Banking Services FCT
  39. 39. WHAT WE INTEND TO ACHIEVE  Bring banking services to majority of Nigerians that are vastly underserved  Create more wealth for investors who will partner with us to establish a presence in the 774 local governments in Nigeria over time  Provide Dual returns- financial as well as social gains to all stakeholders  Promote Microfinancing as an effective portfolio diversification platform  Acquire a national license
  40. 40. WHY WE THINK IT’SPOSSIBLE successes in the FCT  Replicate our across Nigeria by acquiring a National License  Our in-depth understanding of the market and the terrain  Strong Corporate Governance with an active Board armed with decades of relevant experience  Fortis is home for young, dynamic and vibrant professionals.  Our Management’s passion and commitment to transforming Fortis to a world- class, dynamic and vibrant institution that is second to none in the microfinance market space worldwide  The Nigerian realities and the huge and untapped opportunities in our market space  Fortis processes and structures are already tilted towards customer amazement and satisfaction  We use technology as an accelerator- through Mobile Money and e-business  Standardization and innovation are a major driving force in all the activities of the organization.
  41. 41. OUR FUTURE  Strong performance driven by passion for excellence and a conservative but ambitious approach  Top-line growth tied to high level operational efficiency and a solid risk management approach  Maintenance of low NPL ratio despite market turmoil  Solid business plan that ensures robust performance across business cycles  Excellent Business Continuity plan to ensure optimum returns on shareholders value  Positive outlook for 2012 and beyond supported by a strong GDP growth, improved breadth and depth of relationships.
  42. 42. THANK YOU