In his recent best-selling book, “The Age of Agile,” Steve Denning, former programme director of knowledge management at the World Bank, discusses a “Copernican revolution” of management that puts the customer at the centre, rather than the organisation.
This requires an organisational cultural transformation, Denning validly argues, and especially at banks that have long been driven by traditional metrics. The Denning scenario fundamentally captures the FirstBank story.
FirstBank is one of Nigeria’s strongest banking franchises with almost 128 years of unbroken banking operations. As Nigeria’s foremost financial institution, it has continued to innovate and transform itself with revolutionary efforts in the deployment of digital technology to the delight of its diverse customers and other stakeholders which cut across all segments and sectors of the Nigerian economy.
Not surprisingly, its 128 years of dependable services to its customers, investors, host communities, employees and other stakeholders affirm its indisputable leadership of the financial services industry in Nigeria.
Clearly, banking remains a relationship business. For ages, banks have tried to leverage that relationship to grow and maximise shareholder returns. Significantly, because of her emphasis on the long term, FirstBank Nigeria Limited, one of Africa’s largest retail banks both by retail-customer and assets base, apparently has made decisions and weighed trade-offs differently from much of her industry competition.
Denning, who also authored “The Leader’s Guide To Radical Management,” and was visiting fellow at All Souls College, Oxford University, UK, certainly has his point, especially as the Covid-19 pandemic massively disrupted conventional business playbooks and upended the global economy.
With sophisticated, proactive management footing, FirstBank has notably recovered financially and is currently thriving on strong fundamentals, demonstrated by impressive performance. The recent turnaround and improvement in the non-performing loans have also been a major boost in its quest to further improve profitability and reinforce its leadership of the financial services industry in Nigeria.
Its current financial performance and stock attractiveness are driven by the competent and experienced Board and management leveraging the sustainable change towards improving governance practices. With FirstBank, the safety of customers and the security of their transactions come first. This has ensured the Bank keeps the trust of Nigerians gained over the many years of its enduring legacy of safety and security.
Specific industry data show that it is delivering good returns (profit before tax of N130.9bn, up 77.9% y-o-y (Dec. 2020: N73.6bn) having successfully strategically restructured its businesses. It has the capacity to make money/increase PBT due to the nature of its excellent business such as its ability to leverage FinTech and E-business, exploiting technology.
For the bank, the industry environment is much less risky as it has in place, quality assets and has actually grown total assets of N8.5 trillion, up 15.9 percent y-o-y (Dec. 2020: N7.4trn) driven by an increase in customers’ loans and advances (net) of N2.8 trillion, up 27.7 percent y-o-y (Dec. 2020: ₦2.2trn).
FirstBank’s stock price has appreciated and has recorded quality fundamentals stemming from a cleaner balance sheet which includes non-performing loans (NPL) at acceptable levels (at 6.1% from 7.7% in 2020).
The bank has also evolved into a sustained growth phase and delivering performance in line with the size of its business and capabilities of its management. It significantly boasts undiluted focus on customers’ needs and on improving the competitiveness of its offerings; leveraging the opportunities which its large scale provides.
Its turn-around is associated with significant value for its shareholders. The share price of FBN Holdings plc has spiked over 400% over 4 years from N2.70/share to N12/share in 2022 (FirstBank accounts for 90% of FBN Holdings).
In addition, the bank’s customer accounts have grown from about 10 million in 2015 to over 36 million (including digital wallets). The second largest issuer of cards in Africa with over 11.8 million issued cards, onboard over 18.6 million active customers on FirstBank’s digital banking platforms. What’s more – FirstBank’s corporate governance issues have been sufficiently addressed.
As part of its continued growth strategy, FirstBank is unwaveringly focused on mainstreaming sustainable business practices into its operations. The Bank strives to deliver sustainable economic growth that is profitable, environmentally responsible and socially relevant, helping customers to access more and achieve their dreams.
Perhaps not surprisingly, against this backdrop, FirstBank won two awards recently: Best Bank in Nigeria 2022 and Best Banking Digital Transformation Nigeria at the International Investor Awards 2022. International Investor is a print and online publication that provides insights, news and visual informative pieces with topics ranging from world markets, investing opportunities, industry analysis and so much more.
The bank was recognised with the Best Bank in Nigeria 2022 award for its leadership role in promoting financial inclusion in Nigeria which has been integral to improving lives and stimulating businesses of individuals across the country.
Also, the Best Bank in Digital Transformation was awarded to First Bank in recognition of its continued efforts at reinventing its digital banking channels which have been central to reinforcing the bank’s leading role in promoting a cashless society in the country whilst putting customers at an advantage in enjoying secured and seamless digital banking experiences.
The bank’s digital banking channels include its recently unveiled fully automated branch (First Bank Digital Experience Centre), *894# USSD banking, FirstMobile, First online, and WhatsApp banking, among others.
FirstBank has been in the forefront of financial inclusion long before it became a monetary policy direction of the Central Bank of Nigeria (CBN) – with the provision of convenient banking to all Nigerians irrespective of their locations in the country. The bank is also in the forefront of deploying alternative banking channels to assist its customers have access to banking services online, offline, anywhere and anytime.
As a bank woven into the fabric of society, FirstBank clearly remains committed to ensuring that its customers enjoy safe, secure and advanced financial services as they seamlessly carry out their banking transactions on the go, irrespective of where they are.
These unique operational and organisational templates simply assure that FirstBank Nigeria remains ahead of the industry pack.
Salami, an industry analyst, writes from Lagos