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Sterling Bank Goes Holdco As Nigerian Banks Explore New Models

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Sterling Bank joins the holdco (holding company) bandwagon before GTBank which I expect to get there in weeks. GTBank has a different incentive: the GCEO is hitting his 10th CEO tenure (max by regulations) and to remain as boss, he needs a holdco to control the bank. Update: the news is that Access Bank Nigeria has also received approval to turn into a holdco.

Sterling Bank has got the Central Bank of Nigeria (CBN)’s approval to move from stand-alone commercial bank to a holding company (holdco).The Nation reported that the bank is on the verge of obtaining the final approval to convert to a holding company.

According to the report, Sterling Bank, in accordance with banking regime requirement, has divested from its non-bank subsidiaries. The regime requires banks with non-bank subsidiaries to divest or adopt holdco structure.

Explaining the structure, Sterling Bank CEO, Abubakar Suleiman said the bank’s desire to operate as a holding company was driven by its plan to spin off its non-interest banking window which became operational in January 2014 into an autonomous entity.

He explained that the holdco structure enables the non-interest bank and other non-core businesses achieve greater results based on focused management of the distinct businesses while there would be improved efficiency resulting from the consolidation of key functions such as compliance, risk management and other support functions, yielding improved prospects for individual business growth.

For Sterling Bank, I do not think holdco is the fix it needs. Sterling Bank made N5.4 billion in net profit in H1 2020 when Zenith Bank went home with N104 billion. By the law of business, Sterling has a real challenge ahead as banks become platforms where the strongest could get stronger. Yes, it is a positive continuum now. 

I had proposed years ago for Sterling Bank to buy Paystack, a fintech, when it was cheap. My postulation was based on one thing: a challenger banking institution in Nigeria cannot be a bank using technology, but a tech company that offers banking services. Sterling Bank, standalone or holdco, does not meet the marginal cost acidic test of that tech nativity. And that is the issue.

Sterling Bank Nigeria Gets CBN’s Approval to Convert to A Holding Company

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Sterling Bank has got the Central Bank of Nigeria (CBN)’s approval to move from stand-alone commercial bank to a holding company (holdco).The Nation reported that the bank is on the verge of obtaining the final approval to convert to a holding company.

According to the report, Sterling Bank, in accordance with banking regime requirement, has divested from its non-bank subsidiaries. The regime requires banks with non-bank subsidiaries to divest or adopt holdco structure.

Explaining the structure, Sterling Bank CEO, Abubakar Suleiman said the bank’s desire to operate as a holding company was driven by its plan to spin off its non-interest banking window which became operational in January 2014 into an autonomous entity.

He explained that the holdco structure enables the non-interest bank and other non-core businesses achieve greater results based on focused management of the distinct businesses while there would be improved efficiency resulting from the consolidation of key functions such as compliance, risk management and other support functions, yielding improved prospects for individual business growth.

Abubakar said Sterling Bank believes the proposed structure incorporates efficiencies around operations and financing efforts that will support the individual businesses in reaching full potential through increased portfolio diversification and improved efficiency among others.

He further explained that the group would also benefit from enhanced corporate governance, which serves to promote a consistent culture across the group and quality of service to customers, thereby facilitating sustainability of earnings.

Suleiman added that the holdco structure would also facilitate better access to capital by leveraging the consolidated financial strength of the group which would have been otherwise difficult for each individual subsidiary company.

“Going into the holding company structure, our desire is to entrench our business model premised on social capitalism where we believe that private sector capital and market-based tools will offer the best types of solutions to Nigeria’s most pressing social and environmental challenges. The holding company gives us the structure to explore our business model further,” he said.

Suleiman explained that the holding company is designed to operate on three major premises of specialization, partnership and digitization.

He said while the conventional bank will focus on building skills and using technology to provide solutions in the areas that are critical to development in the country including health, education, agriculture, renewable energy, transportation (HEART), the non-interest bank will focus on building partnerships that connect individuals and businesses leveraging technology to create business optimization while solving for individual daily financial need.

“The overall business will focus on social impact, corporate responsibility and religious compliance in its dealings. Our digitization drive will create an enabling environment for both financial institutions to grow while providing services and support to build efficiencies in different ecosystems. The execution of our plans is fully dependent on our interwoven operating model of agility, specialization and digitization,” he said.

Recent changes by the CBN, including the downward review of their charges for account maintenance on deposit money, have impacted the revenue generation of some Nigerian banks.

Sterling Bank is among the banks affected badly by the impact of the apex bank’s decision. Compared to its revenue in Q2 2019 (N4.1bn), the bank lost nearly half of its revenue (N2.4b) in the Q2 of 2020. For the first half of 2020, Sterling Bank made N5.4 billion in profit, below what it made (N5.7bn) in the same period in 2019.

However, the bank also went above the benchmark to record a loan to deposit ratio of 68.2% in Q2 of 2020, and met capital and liquidity requirements at 15.2% and 33.5% respectively.

The strains of COVID-19 pandemic took a toll on the financial industry, plummeting gains and prospects. But Sterling Bank’s Tier-2 improved its income by 9.6% between Q1 and Q2 despite the challenges. However, high interest rates became an obstacle that cannot be overlooked.

Naira Metrics reported that Sterling’s proportion of interest expense to interest income is at 40.9%, which provides insight that the Tier-2 bank failed to generate sufficient cheap deposits and borrowings to run the bank’s business with.

These developments of losses, including the need for digitization, emphasized the need for diversification for Sterling, and going ‘holdco’ which has been in the pipeline was hastened.

Eonsfleet Improves Supply Chain and Business Operations Through End-to-End Automation

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Join me to congratulate Tokunbo Olaitan Arannilewa, the CEO of  Eonsfleet Prosolutions Limited , a Fasmicro Group portfolio company. Today, one of our customers noted that using Eonsfleet technology and services, they recorded 54% reduction in energy usage. Eonsfleet is Nigeria’s leading company on all dimensions of monitoring, maintaining, servicing, and tracking of special assets like generators, fuel tankers (it tracks the trucks and the liquid they carry), etc.

This is the mission of Eonsfleet. To make businesses profitable, efficient and stay afloat by providing them the technologies that will help them to reduce waste, cut unnecessary cost, become efficient, optimize decisions among others.

Eonsfleet is a managed service designed to allow distributors of bulk lubes and fluids, propane gas, and other liquids to remotely monitor tank fill levels (in moving trucks, depots, fuel stations, etc.), optimize distribution and ascertain compliance to desired destinations. Purpose-built to improve inventory management.

To extend its services beyond the fuel supply chain market, Eonsfleet offers IoT applications around the fleet, fuel and energy remote monitoring solutions which include the remote monitoring for diesel generator, fuel and grid for facility managers.

The Eonsfleet IoT Platform, a proven, highly scalable, customizable IoT Platform, powers Fleet Management Software, Smart metering solutions, E-logistics, Warehousing and Supply Chain Control Tower Software. (SaaS).

It brings a gamut of powerful capabilities in energy management, remote asset management, environment monitoring, location tracking, alerting, intelligent dashboards, reporting and analytics.

With Eonsfleet, no one will fool you with tracking an empty truck which is moving from Lagos to Bauchi, when the real fuel is being diverted to Togo!

If you need help, Tokunbo is ready to assist. We bring intelligence to your supply chain.

Eonsfleet Helps Businesses to Run More Efficiently Through Automation

Eonsfleet Helps Businesses to Run More Efficiently Through Automation

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This may be the only strategic plan and investment your business needs in order to stay afloat, and become profitable or cash flow positive in the year 2021.

It has become very obvious that the Covid-19 Pandemic had challenged and changed your business. It has made you sit up and become very strategic in the future planning of your business.

It has made you think in this line. How can my business be profitable post Covid-19, after staying at home for months?

Well, we discussed a lot on the importance of innovation in making a business profitable, because it helps to change the basis of competition.

We also talked about effective marketing, because it actually builds brand awareness and leads to sales.

But here is how things have been changed by the pandemic: innovation and marketing involves huge investment in order to implement their strategies in your business.

The reality is that you must find a way to survive and stay afloat in business in a cost effective way, while making profit in Post covid-19.

The best strategy to deploy is value creation, cost reduction or cost minimization strategy through AI and IoT technologies.

This is the mission of Eonsfleet. To make businesses profitable, efficient and stay afloat by providing them the technologies that will help them to reduce waste, cut unnecessary cost, become efficient, optimize decisions among others.

Eonsfleet is a managed service designed to allow distributors of bulk lubes and fluids, propane gas, and other liquids to remotely monitor tank fill levels (in moving trucks, depots, fuel stations, etc.), optimize distribution and ascertain compliance to desired destinations. Purpose-built to improve inventory management.

To extend its services beyond the fuel supply chain market, Eonsfleet offers IoT applications around the fleet, fuel and energy remote monitoring solutions which include the remote monitoring for diesel generator, fuel and grid for facility managers.

The Eonsfleet IoT Platform, a proven, highly scalable, customizable IoT Platform, powers Fleet Management Software, Smart metering solutions, E-logistics, Warehousing and Supply Chain Control Tower Software. (SaaS).

It brings a gamut of powerful capabilities in energy management, remote asset management, environment monitoring, location tracking, alerting, intelligent dashboards, reporting and analytics.

How Eonsfleet Value Propositions Will Solve Problems Associated With Business Equipment and Properties Management.    

Here are the real and measurable values that Eonsfleet solutions will have on your business operations, as it relates to asset, fuel, and equipment management.

  •  The Efficiency Value:

With our specialized solutions and products, such as Fleet Management Software, E-logistics software, Supply chain Control tower, Fuel Tanker Content Monitoring, Diesel Generator Monitoring Solution and Fuel Station Manager (Forecourt), the central goal is to use data to achieve efficiency for your business.

You will be able to cut waste and have real time information on your fleets, your diesel generators and other logistics through the data that will be provided by these technologies.

  • The Visibility Value.

We helped you to remove all the guesswork that is associated with your decision making process, by providing you real time data.

A great example is the fleet monitoring solution, we provide you with your diesel level, the quantity of fuel filled, how many litres are available etc. This can be monitored from anywhere, at anytime.

This makes your decision making to be supported by data. The same is applicable to your fleet or logistics operations.

  • The Security Value

When there is a protection of your fleets and your drivers are law compliant, it impacts the business performance. With the fleet monitoring solution, we ensure we have data to monitor the behavior of your drivers and other important data about your fleet.

This helps to ensure compliance and security of both the vehicles and drivers.

  • The Optimization Value.

We help to optimize your operation by using the data available from your fleet monitoring software to make strategic planning on what business decisions to make that will impact your bottom-line.

  • The Profitability Value.

The overall impact of this solution is profitability which is caused by the realization of efficiency, and optimization of your business operations.

At the end, you will invest less and derive massive values while reducing cost of operation strategically. This is what we want to help your business to achieve in post covid-19.

Businesses Are Already Making Strategic Deals and Partnership with Eonsfleet.

Some businesses with strategic foresight, who know the quantitative impacts of our solution to businesses in Africa are already deploying the solutions.

Moove Africa is a car rental service provider that provides customers cars to use on Uber, on a weekly basis.

This company has sealed a deal with Eonsfleet to provide a fleet monitoring solution that will ensure that the company has data to monitor the activities of its vehicle, in real time, and at all times.

This will help them to achieve many benefits such as, real time visibility of asset’s condition, set asset maintenance module, set some vital restrictions to ensure proper and standard asset usage and lot more!

Eonsfleet is here to serve.

Medcera Welcomes Thelma Ejiogu As CEO

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Good People, join me to welcome Thelma Ejiogu, as the CEO of Medcera, to the community. Medcera is a web-based EHR (electronic health record) system with patient portal. It provides physicians and medical professionals with technology along with personal health record for patients. It supports large and small medical institutions like clinics, labs, pharmacists, and imaging centers to move their operations into the digital ecosystems where they can increase productivity, lower costs on medical information management, improve quality of care and employee/patient safety.

Also, Medcera offers health insurance solution enabling integration of physician, billing, insurance, government receipts and other components of health insurance delivery in one system. All Medcera systems run on the cloud with no requirement for any hardware installation. It is supported with bank-level security.

Our motivation for starting Medcera is anchored on the fact that once a patient has a record with Medcera, every approved health professional will have access to that record irrespective of time and location. So, anywhere you are, provided the entity and you are in the Medcera Network, your records would be accessible, if you give approval. We think this will save lives.

Medcera patient card