Apart from providing financial services to low-income earners, LAPO Microfinance Bank Limited is also committed to social and economic empowerment of this group of people. One of such social commitments is the affordable housing scheme that targets 400 clients in six months. Housing Micro Finance (HMF) is a new intervention approach to deliver affordable housing to the less privileged.
LAPO’s interest in embracing the concept/innovation, according to Godwin Ehigiamusoe, managing director, is born out of its social and environmental mandate of lifting clients out of poverty and improving lives.
HMF involves the provision of loans and other financial services to low-income households to enable them improve or repair existing homes, extend existing structure or construct overtime a new house.
To execute this, LAPO, Lafarge Cement and the AFD (French Development Agency) late last year collaborated on affordable housing in Nigeria to the tune of over N1 billion.
The specific objectives of affordable housing for low-income persons include developing affordable housing scheme that meets the need of potential and existing LAPO low-income clients, evolving a payment system that would not have negatives on the clients’ cash flow and living standard – competitive pricing, ensuring sustainability and quality loan portfolio for the affordable housing scheme, and maintaining strong relations with social investors’ and partnership that support LAPO affordable housing scheme.
“Shelter is an aspiration of every human being, rich or poor, thus there is need for a liberalisation of access to housing as house ownership is a symbol of maturity and fulfilment for everybody, irrespective of gender or one’s status in life,” Ehigiamusoe said.
The bank has always been committed to finance-plus approach, even before the current focus on social performance management. The bank’s social performance activities are encapsulated in its ESG (environment, social and government) initiative.
In 2012, LAPO took steps towards clearer definition of social goals, enlisting adequate commitment of its board and employees to social performance; client protection and support, and institutionalisation of sustainable microfinance practice.
LAPO plans to disburse N92.7 billion in 2014, after it disbursed a total of N62.2 billion in 2013. The bank recorded 76 percent profit after tax from N908 million in 18 months period to December 31, 2011, to N1.6 billion in 12 months period ended December 31, 2012. Profit before tax for the 18 months period ended December 31, 2011, was N2.1 billion, representing 19 percent increase to N2.5 billion for 12 months period ended December 31, 2012.
The bank’s gross earnings rose by 7 percent to N8.8 billion for 12 months period to December 31, 2012, from N8.2 billion recorded within 18 months period ended December 31, 2011. Loan disbursement increase by 7 percent to N46.4 billion during the year under review, from N43.3 billion in 18 months to December 31, 2011. The bank’s client base accelerated to 756,904 in 12 months period – December 31, 2012, from 518,187 in 18 months period ended December 31, 2011, representing an increase of 46 percent.
Total deposit liabilities of the bank increased by 40 percent, from N7 billion in 18 months to December 31, 2011, to N9.8 billion for 12 months period ended December 31, 2012. Its gross loan assets rose from N11.4 billion in 18 months ended December 31, 2011, to N16.9 billion in 12 months period ended December 31, 2012, representing 48 percent increase.
By: HOPE MOSES-ASHIKE
