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BY EMEKA EJERE

Nigeria’s biggest bank by assets, Access Bank Plc is not leaving anyone in doubt that it is indeed working towards its goal of becoming Africa’s gateway to the world. Barely one month after it acquired a South African bank, the tier 1 lender, said on Monday it has agreed to buy a majority stake in African Banking Corporation of Botswana for cash.

By the agreement, the lender will acquire over 78 per cent of BancABC Botswana for cash of around 1.13 times book value and a two-year deferred payment, amounting to an undisclosed sum, Atlas Mara said in a statement.

The latest acquisition from ABC Holdings, the local unit of London-listed Atlas Mara, which is expected to close before the end of the second quarter, according to Reuters, brings the bank’s African presence to 10 countries.

“We remain committed to a disciplined and thoughtful expansion strategy in Africa, which we believe will create strong, sustainable returns,” Group Chief Executive, Access, Herbert Wigwe said.

Banc ABC Botswana is the fifth largest bank in Botswana and has a quality retail loan book with the scope for expansion into corporate and small to medium-sized enterprise lending, Access said.

Nigerian lenders have been seeking new avenues to boost profit amid slow economic growth at home, a drop in government bond yields and a rise in restructured loans due to the impact of the pandemic.

Accordingly, Access Bank, which targets 22 African countries for presence over the next five years, is seeking new growth avenues as the Nigerian economy struggles to fully exit a second recession in less than five years. It hopes to leverage the African Continental Free Trade Area agreement to enter Morocco, Algeria, Egypt, Ivory Coast, Senegal, Angola, Namibia and Ethiopia.

In March, the bank bought a controlling stake in South Africa’s 74-year-old Grobank for around $60m, becoming the first Nigerian lender to venture into South Africa.

The acquisition, which was its third in eight months, having taken over Kenya’s Transnational Bank in July and Zambia-based Cavmont Bank in January represents the culmination of the bank’s aspiration to foray into Africa’s most industrialised nation and tap into its market. South Africa has the largest banking sector on the continent, with combined assets of $482.71 billion, according to S&P Global Market Intelligence data.

Strategic growth

With its successful ‘merger’ with Diamond Bank in 2019, Access Bank made a bold statement of intent to dominate the Nigerian banking space. It was a transaction that instantly shot it up as the biggest bank in the country, with assets base of N7.28 trillion, and customer base of 31 million.

However, an appreciation of N1.537 trillion or 21.6 per cent within one year has ramped up the assets value of the lender to N8.680 trillion. The valuation, which has been helped by the Kenyan and Zambian acquisitions, is expected to improve further with the completion of the South African deal this second quarter.

With plans to more than double customer numbers over the next three years by expanding in the rest of Africa, the lender is creating a holding company structure that will enable it diversify into other financial services separately from the banking business.

“The objective of the bank is to ensure that by the end of 2023 we have over a 100 million customers,” from about 37 million currently, Deputy Managing Director Roosevelt Ogbonna, told an international medium.

Access Bank was a small commercial bank, ranked 65th in size out of 89 banks in the country when Wigwe and his business partner, Aigboje Aig-Imoukhuede, acquired it in 2002. It was scaled up through a series of strategic mergers and acquisitions to build capacity and market strength over the years.

Wigwe took over from Aig-Imoukhuede as the bank’s MD/CEO in 2014 and has been driving its expansion, both in terms of footprint and product diversification, ever since.

The bank currently serves over 4m individual and corporate account-holders through over 600 branches and more than 3,000 Automated Teller Machines (ATMs) in major centres across Nigeria, sub-Saharan Africa, and the UK. It is now ranked among the top five banks in Nigeria in terms of assets, loans, deposits and branch network.

In 2005, it acquired Marina Bank and Capital Bank and a few years later, it acquired the shares of Omnifinance Bank. It then took a leap forward with the 2011 acquisition of Intercontinental Bank. But the deal that really set it ahead of the pack in terms of size was the 2019 acquisition of Diamond Bank, another top-tier Nigerian institution, in a deal worth $200m.

It has also continued with its quest to increase its global footprint and now has subsidiaries in Ghana, Sierra Leone and the Gambia in West Africa and beyond, in Kenya, Democratic Republic of Congo, Rwanda, and Zambia. It also has an operation in the UK and representative offices in China, India, Lebanon and the United Arab Emirates.

Speaking on the bank’s plans to increase its rest-of-Africa business, Wigwe said: “We want to have subsidiaries across 22 countries over the next five years, with strategic plans to be present in the major trade corridors on the African continent. Building on our successful expansion into Kenya, we will also be making entry into Angola and Mozambique.

“At the moment, Access Bank does not have a presence in the Francophone region of Africa, and we will be working to see that this is changed in the coming years.

“By 2023, Access Bank will have consolidated its position as Africa’s gateway to the world with about 100 million customers in Nigeria and additional 20m customers across our African subsidiaries.”

The group is relying on its digital capability and innovative payments solutions to take the business to the next level as part of its expansion strategy.

Access Africa

Also in the spirit of uniting Africa through banking services, the Access Africa Platform is its fund transfer product designed to provide instant intra- African transfers.

“Access Bank is set to revolutionise the payment and banking landscape in Africa. We will soon be introducing a new payment system that will allow users to enjoy a secure, seamless and convenient service when making payments at merchant locations without cash or card,” Wigwe told New African Magazine.

This, he explains, will help to bridge financial literacy gaps in both Nigeria and elsewhere in Africa.

In mid-2020, Wigwe was named the African Banker of the Year at the African Banker Awards, an annual awards ceremony hosted by African Banker magazine under the High Patronage of the African Development Bank.

The award was in recognition of Wigwe’s many achievements. Over the 12-year period starting from when he was still the deputy CEO, he has grown Access Bank’s balance sheet by 1,022%, from $901m in 2007 to $19.7bn in 2019, while pre-tax profits rose to $316m from $21m over the same period. This was more than the cumulative profit made by the bank in the previous 12 years.

Wigwe’s several socio-economic efforts, including leading Nigeria’s private sector Covid-19 response were also recognised. The bank donated more than $2.7m to support the government in fighting the virus, while championing the Coalition Against Covid-19 initiative in Nigeria.

Receiving his award, Wigwe said, “Financing and facilitating a sustainable future for Africa, and indeed the world is something I am most passionate about.

“Now, more than ever, Africa needs us to unite as we seek to improve access to health care, sustainable energy, finance, and improve the standard of living in our communities.

“I enjoin all stakeholders to be a part of the facilitation of a truly sustainable future for Africa. The future of our respective organisations and the future of generations to come depend on the alliances we form and the actions we take.”

Access Bank, he said, has already taken steps towards facilitating this future by issuing the first-ever Climate Bonds Initiative, certified Green Bond in Nigeria. The bank also won the Agriculture Deal of the Year for the deal that has made the most impact, for its role in helping Singaporean commodities trader Olam develop its rice operations in Nigeria.