The Managing Director/Chief Executive Officer, Wema Bank, Mr Ademola Adebise, in this interview with EMMANUEL ABODUNRIN, says the bank will leverage technology and innovation to double the key indices of its assets, deposits and profits within the next two years
How has the journey been so far?
I joined the bank in 2009 and then we embarked on moves to improve the bank. The first thing was to address the liquidity situation; stabilise the bank and then begin to have the building blocks in place. The last phase, which we are in now, is growing the bank. So, being the MD has been tough but exciting. Last year was a major milestone for us; declaring dividends for the first time in 14 years. The last time was in the time of Mr Tunde Lemo. The outcome of our transformational efforts over the past nine years has culminated in the payment of dividends for the 14 years.
Where are your projections?
We intend to be a strong retail bank, leveraging technology and innovation. For us, what we have said is that we would work to double our key indices of assets, deposits and profits, so that by 2020 we would have achieved the doubling of our numbers. We have key sectors of the economy that we have mapped out to achieve this growth. We are also trying to ensure that we have well trained and well remunerated members of staff to be able to achieve the vision and we are very committed to it.
What strategies do you plan to adopt to remain competitive in the market?
To remain competitive in this market, one needs to be very innovative. Basically, everything in the banking industry is commoditised, talking about products. For us, we want to be innovative, agile and speak to the market with products that appeal to the customers. It’s about appealing to the needs of the customer. That, for us, is very key. We would leverage technology as much as possible. The Alat product that we launched few years ago is doing very well and what we are doing now is to review it and take it to the next level, I mean taking it to a platform where we would be appealing to lifestyles. We have a lot of value creators, consumers and buyers and sellers on the platform and the idea is to reduce the cost of doing business. We have sectors we have mapped out for us to play in, I mean in the retail space. We have the SMEs, agric value chain and we have clearly mapped out products that we would use to appeal to these segments of the market. The bank was set up as a retail bank in 1945 and we have not moved away from that vision, but we have been evolving. What we are saying is that in the next two years, we want to double our key indices through an organic growth. Today, we are about N400bn, in the neighbourhood of N500bn in assets, and if we stretch that, we would be shooting for N800bn by the time we double our indices. We want to get to N1tn mark in terms of our assets but we are not saying we would get there through M&A.
What has been your experience with IFRS?
In 2018, we adopted IFRS-9 and the impact was felt but not heavily felt. And I think it’s based on the quality of the collaterals that you have against your risk assets. For us, going forward, is to ensure that we have that discipline to create good quality loans. If you do, you are not going to have an adverse effect of IFRS-9, if you understand what I’m saying. That is the way not to incur the wrath of IFRS-9; I mean discipline, corporate governance and ensure that you give quality loans.
What are the sectors you are looking at?
Basically, oil and gas, SMEs and agriculture. There is a CBN intervention scheme towards agric already and what we have done is to tailor our products along the intervention schemes of the government. For agric, we have done our strategy and we have looked at the value chain. We want to focus on processing and we would look at the aggregators for all the SMEs and peasant farmers. And in supporting the aggregators, we look at key crops like cassava in the South-West and rice in the North and we are looking at engaging them. What is of interest today is that business models are changing. It’s not the old style of doing agric; we are talking about the different players within that value chain and being able to use technology to put everything together. Agric is the major contributor to our GDP and then we look at how to boost export, which would bring back a lot of forex into the system and our reserves. So, it’s a cycle. In the creative industry, like entertainment, Nollywood, etc., we also see opportunities. We are trying to create a structure to ensure we take advantage of that space. If the government is interested in certain sectors, we key into such and begin to build competencies in that space to be able to add value.
What of cocoa?
It’s not that cocoa is not in our area of interest, but you know it’s perennial. As we speak today, cassava is on the front burner for the CBN, so you can quickly harvest and make your money. Just as what rice is to the North, companies are also setting up processing companies in the South-West to take advantage of the increasing cassava plantation there.
We want to be an innovative bank, generate ideas and solve problems using technology. We got young, brilliant minds to come together and pitch solution to some of those problems. The whole idea is to generate good ideas and put money behind the best idea and take it to commercial level. The three main problems we want to solve are; reduce cost to service our customers, improve top line revenues for the bank and the last one is to solve societal problems. We got very interesting ideas from young, talented and energetic Nigerians and that was why we said idea donation in a bid to build a very innovative bank.
Being able to declare dividends after several years must have been a product of real innovation. What did you do differently?
There was no magic wand about it. Basically, this is a journey of over nine years. We started in 2009 with a transformation plan, which led to our ability to pay dividend today. Some people can question the three kobo, but it’s because we have over 38 billion units in circulation. It’s been a journey and what we intend to do is to continue to improve on this.
Deploying technology is expensive, but it’s inevitable. What’s the plan on the bank to bridge that gap?
We have all the right tools in place and apart from our Alat product, we are refreshing our IT. It is expensive but we are responsible and most of our top management staff have deep IT background, so technology is not strange to us. It’s not just about pumping money to excite ourselves, we know what we are doing. Shareholders are interested in returns, so we have to deploy our limited resources in a way that would benefit all stakeholders. We have a clear digital journey we are working on to ensure that internally we deal with all issues. The other question you might want to ask is won’t people lose jobs? No, because business models are changing. What is happening with technology adoption is that business models are changing. How do you monetise the data available to you and how do you monetise it. About a week ago, we saw a report that about 1,000 persons were laid off by Wema Bank and the question I asked was that how many people even work in the bank. Of course, that was not true.
How are your branches faring in the North?
When we got our national licence in 2015, we decided to go back to the North and the East. Today we are in Kano, Kaduna, Lokoja, Minna and Bauchi. That is five in the north and they are picking up. We hope to go to other areas in the North. It’s not based on wishful thinking or sentiments but business exigencies and considerations. In the East, we have opened in Aba, Abia State, and we are even about opening a second one there. So, it’s not just about launching out, but where there is business.
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