Wema Bank Plc, weekend announced that its Board of Directors has finally endorsed plans to concentrate on regional banking, even as it recovered N30 billion from its debtors.
The Bank listed 2,500,618,928 ordinary shares of 50 kobo each at N1.66 per share on the Nigerian Stock Exchange (NSE) following its conclusion of a private placement to raise N7.5 billion.
The Managing Director/CEO, Wema Bank Plc, Mr. Segun Oloketuyi, while addressing capital market community at the Lagos floor of the Exchange during the Bank’s fact behind its private placement said, “our bank has been fully recapitalised as the shareholders’ funds as at September 30, 2010 stood at N43.313 billion.
The Board members have collectively agreed to go for regional banking in order to reap the comparative advantage by concentrating on our niche areas. It was a decision taken by the Board and not that the Central Bank of Nigeria (CBN) imposed it on us. We carefully assessed all our branches throughout the country and discovered that the Northern Zone and South East Zone was not contributing much to the bottom line”.
Continuing he said, “we have greater proportion of our infrastructure in the target South -South and South West market. The “Region” accounts” for 98.8 per cent of our total loan portfolio and 97 per cent of our deposit as at December 2010. A total of 137 out of the Bank’s 154 branches (90 per cent) are located where we have chosen to operate. We have comparative advantage in this region. So it is a well thought out plan and strategic”
The Wema Bank boss stressed that the Bank still offer the same bouquet of banking services as obtained in a national or international bank
According to him,” In Nigeria, a regional bank can operate in a minimum of six and a maximum of twelve contiguous states and the FCT. Those states must be within no more than two geo-political zones. Therefore, we are closing 17 branches( 13 in the North, 4 in the South East).
This will have implications for customers (depositors and borrowers), staff, and assets. But we are assuring our staff in those branches that will be closed that none of them would be sacked but they would be redeployed to other areas to boost our operations.
According to him, “ the current shareholding structure include: Odua Investment Company(South-West states) 10 per cent, Core investor 31.42 per cent and others 58.58 per cent. No single shareholder holds more than 1 per cent in this category.
He commended the different laudable roles played by the regulators in the journey to recapitalize Wema Bank, saying “ shareholders should begin to expect dividend from 2012 .Our commitment to the Stock Exchange and other stakeholders is to run a bank where business is conducted at the highest professional and ethical standards to guarantee the investment of shareholders and depositors alike, and peace of mind to regulators”.