Bridge Banks Intervention Yielding Fruits —Enterprise Bank MD

Managing Director Enterprise Bank, Mr Ahmed Kuru, has said Central Bank of Nigeria’s  policy of using ‘bridged banks’ to rescue distressed banks in the country was in order,  as the idea is now yielding fruits.

Kuru said the existing three bridge banks – Enterprise Bank Limited (Kuru’s bank), Mainstreet Bank Limited, Keystone Bank Limited – which took over formerly distressed Spring Bank, BankPHB and AfriBank in August 2001, to run them temporarily, have been restructured and are back to profitability.

“When we came on board, our mandate was to run the banks profitably with strong financials. I can categorically say that the three banks are strong enough to compete with others,” Kuru told a press conference in Lagos.

Kuru said Enterprise Bank has been able to grow its deposits by over 27 per cent (above  the industry average of 15 per cent); its loan book by 200 per cent, with average industry rate being 16 per cent; and asset base by 26 per cent; and return on investment (ROI) by 20 per cent, which is over seven per cent above industry average.

He said it was up to the Asset Management Corporation of Nigeria (AMCON) to determine what to do with the three bridged banks, adding that “what is important to us, is to run the Institutions commercially, profitably and put all the structures on ground to ensure that business continues,  because whoever steps in to buy the banks is not coming to buy structures, he is coming to buy the value that is in the structures”.

Countering the notion that the banking sector was “over regulated”, Kuru argued that it was in line with global practice.

According to him, the financial sector is the most regulated in the world, explaining that what the CBN is trying to do is to ensure that they put necessary measures in place so as not to be caught unawares.

“I can tell you that most part of the circulars (guidelines) they put out, are also discussed at the Bankers Committee meeting. They want to carry everybody along, and as partners, we will see how to reposition the industry, it will not be driven by individuals; but structures.

“So if  anybody comes into the system, regardless of what happens, the structure will mould how he conducts himself. We are not distracted by the CBN’s regulation; but rather, encouraged by it. So, we will continue to operate in a way that we do not go contrary to the CBN rules,” Kuru said.

On the cash-less initiative, whose pilot is running in Lagos, Kuru said it was the ultimate, but added that the country needed to enforce the law on dud cheque issuance in such a way that issuers should be sent to jail within three weeks.

Speaking on his bank’s growth strategies, Kuru said Enterprise Bank Limited will not engage in the ‘game or war of size’ but will remain efficient and increase its Information Technology (IT) platforms to transact its business and reduce the number of people coming to the banking hall.

To aid this, he said the bank has invested in modern Information and Communication Technology solutions that would make it convenient for people to carry out banking operations in the comfort of their homes and officers, as well as through their mobile telephones.

“We are still a medium-sized bank. If you look at the unverified figures that I gave you in absolute terms, you will see that if I grow by 20 per cent of N200 billion or N40 billion, and another bank, for example, grows by one per cent of say N5.0 trillion, in terms of size, I am still a medium-sized bank and I want to be a medium-sized bank,” Kuru explained.

-Tokunbo Olajide