The best banking institution in Nigeria in terms of efficiency and effective utilization of capital is GTBank. Its separation from others is mind-blowing. In short, GTBank’s cost to income ratio (37% for 2018) is one of the best in the world. I used to be a banker; such numbers do not come by luck!

So, the platform-bank has its audited numbers – it made N216 billion before tax. The profit belongs to GTBank because the most profitable customers in Nigeria converge to GTBank. As I noted last year, its grand strategy remains the unification of all things. Hello Habari Banking!

To “create a platform and partner anybody who has a service to offer. So that if as a customer, one comes into our ecosystem, you can do just anything. You could do your banking business, buy your tickets, insurance, travel; if you wanted a 10-day pay day loan, you can do it. So, really we want you to come into our ecosystem, maybe five times a day to do different things other than banking.” Segun Agbaje, CEO, GTBANK

Press Release below

Guaranty Trust Bank plc has released its audited financial results for the year ended December 31, 2018 to the Nigerian and London Stock Exchanges.

A review of the results shows positive performance across all financial metrics and improved strategic positioning of the brand. Gross earnings for the year grew by 3.7% to N434.7billion from N419.2billion reported in the December 2017. Profit before tax stood at N215.6billion, representing a growth of 9.1% over N197.7billion* recorded in the corresponding year ended December 2017. The Bank’s customer deposits increased by 10.3% to N2.274trillion from N2.062trillion in December 2017, however, loan book dipped by 12.9% from N1.449trillion recorded as at December 2017 to N1.262trillion in December 2018.

In view of the above, the Bank closed the 2018 financial year with Total Assets of N3.287trillion and Shareholders’ Funds of N575.6Billion. In terms of Assets quality, NPL ratio and Cost of Risk improved to 7.3% and 0.3% in December 2018 from 7.7% and 0.8% in December 2017 respectively. In addition, coverage ratio for NPL stood at 105.1% and Capital adequacy ratio remained very strong, closing at 23.4% despite the implementation of IFRS 9. On the backdrop of this result, Post Tax Return on Equity (ROAE) and Return on Assets (ROAA) closed at 30.9% and 5.6% respectively. The Bank is proposing final dividend of N2.45k per unit of ordinary share held by shareholders in addition to interim dividend of 30k per unit of ordinary share bringing total dividend for 2018 financial year to N2.75k per unit of ordinary share.

Commenting on the financial results, the Managing Director/CEO of Guaranty Trust Bank plc, Mr Segun Agbaje, said; “In 2018, our focus on staying nimble, strengthening customer relationships and driving our digital-first strategy paid off. We successfully navigated the pressures of our challenging and radically changing business environment, recorded growth across key financial indices and reaffirmed our position as one of the best performing and well managed financial institutions in Africa.

He further stated that; ‘This result reflects, not just the fundamental strength of our brand, but also our commitment to our values of excellence, creating value for all stakeholders and putting our customers first in everything that we do. Driven by these values, we are building the bank of the future by pairing the best of our business with the massive potential of digital technologies to create Africa’s first integrated and trusted platform; Habari.

GTBank has continued to report the best financial ratios in terms of profitability, efficiency and capital for a Financial Institution in Nigeria as revealed by its return on equity (ROAE) of 30.9%, cost to income ratio of 37.1% and capital adequacy of 23.4%. These ratios are a testament to the efficient management of the Bank. In recognition of the Bank’s bias for world class corporate governance standards, excellent service delivery and innovation, GTBank has been a recipient of numerous awards over the years. Some of the Bank’s awards in 2018 include Bank of the Year – Nigeria from the Banker Magazine, Best Banking Group and Best Retail Bank Nigeria from World Finance Magazine, Most Innovative Bank from the African Investor, and Best Digital Banking Brand in Nigeria from the Global Brands Magazine.

GTBank Grand Strategy in one Paragraph, from CEO Segun Agbaje

Manchester United is in the next phase of the Champions League. They made history last night, recovering from a 2-0 home loss against PSG, to become the first team in a European competition that lost 2-0 at home, and yet advance after the two legs. ManU defeated PSG 3-1 last night, advancing on away goals on aggregate of 3-3.

Yet, he used the same players as Jose Mourinho, the special one, whose star faded evidently.

That brings me to this question: who can motivate your team? Yes, as you can see, one man will take a highly castigated team to achieve impressive results. Before Solskjaer arrived, ManU was a yo-yo team. Today, it is a team for those that believe.

People, find a better manager. Yes, find a better operator. Until you can discover what can motivate or who can motivate your team, you may struggle to take that mission to the zenith. Find your Solskjaer in that business today.

How Can You Motivate Your Team? Who Is Your Ole Gunnar Solskjaer?

I discussed the Cloud business in Nigeria last year. I noted the positions of MainOne, MTN Cloud, Rack Centre and Vodacom.

There are four main cloud providers in Nigeria –  MainOne, MTN Cloud, Rack Centre and Vodacom. Two of these companies, MainOne and Rack Centre, have cloud services as one of the key components of their businesses. Sure, MainOne sells bandwidth, delivering connectivity services, but cloud service is a key business. MTN is known for its voice telephony and the broadband services, across Nigeria and beyond. Vodacom Nigeria is largely there to serve enterprise customers, since it is not operating any voice telephony service, yet.

In that piece, I dropped these lines: “Amazon is coming. It is never a good thing when Amazon comes into town or in any sector, globally and locally. They have this ruthless business efficiency model that makes everyone look lost”. Interestingly, instead of Amazon arriving first, it is Microsoft Azure that won the race into Africa on datacenters. Yes, Microsoft has opened first datacenters in Africa with general availability of Microsoft Azure.

Simply, the challenges of latency will disappear and many companies will have options now that hosting is in Africa. This is a game-changer in a market where most startups and non-regulated companies prefer Amazon, Google and Microsoft, over their local competitors. Also, with the datacenters in Africa, Azure will help many firms overcome compliance issues which require data to be stored locally; local cloud firms have used that compliance provision to keep some businesses. With that localization advantage gone, expect price war to heat up, in the sector, as local players will have to reduce price to compete.

Today, Microsoft announced the opening of its first datacentres in Africa, with the general availability of Azure from the new cloud regions in Cape Town and Johannesburg, South Africa. This makes Microsoft the first global provider to deliver cloud services from datacentres on the continent, which will help companies securely and reliably move their businesses to the cloud while meeting compliance needs.

“Microsoft Azure is now available from our new cloud regions in Cape Town and Johannesburg. The combination of Microsoft’s global cloud infrastructure with the new regions in Africa will create greater economic opportunity for organisations in Africa, accelerate new global investment, and improve access to cloud and internet services,” says Yousef Khalidi, corporate vice president, Azure Networking, Microsoft.

The Challenge before MainOne and Rack Centre

Those days in Baltimore, I used to visit where riders “take off’ for an “American tradition” enjoyed by many in the nation. Harley-Davidson is a great American brand which has legions of fans across the nation. Typically, men come together, with elegantly designed motorcycles, and then take off on a journey, around town, to immerse in the wonders of riding-entertainment. The men do enjoy the show.

But for the company, there was a problem: younger people were not getting into the game. And if the firm cannot attract new and younger riders, its future is largely imperiled. So, when I read that Harley-Davidson was buying an electric-powered, two-wheeler toy company, I knew it was in for something futuristic.

Yes, let the kids ride bikes with Harley-Davidson logo, and possibly when they want the real thing, they will buy Harley-Davidson motorcycle. That is a very smart way for future-proofing a business: recruit them early and make them believers. As Coke will remind us thus: do not worry that you keep seeing our adverts (thinking they are wasteful), we are merely reaching infants and toddlers, and not necessarily you. Your generation has been won for Coke, but we need to recruit the next one fast!

As Harley-Davidson noted in the press statement announcing the deal, the toy riders are expected to be long-term riders: “our mission [is] to create the next generation of riders is exciting”.

Harley-Davidson, Inc. (NYSE: HOG) announces today that it has acquired StaCyc, Inc., producer of the 12 and 16 EDRIVE, electric-powered two-wheelers specifically designed for kids.

[…]

As a subsidiary, a Harley-Davidson branded version of StaCyc’s 12-inch and 16-inch models will be sold through select Harley-Davidson dealers. The branded products will be available in the U.S. in the third quarter of 2019.

[…]

“After a few conversations with Harley-Davidson, we realized that the ethos of our brands and our commitment to bringing more riders to motorcycling were incredibly aligned,” said Ryan Ragland, Founder of StaCyc. “The opportunity to work with the team at Harley-Davidson and have the support to carry out our mission to create the next generation of riders is exciting. Together we’re building a plan that fast-tracks our ability to help the industry create as many riders as possible.”

[…]

The StaCyc acquisition is the latest example of how Harley-Davidson is investing in opportunities that inspire increased ridership in the near-term and deliver sustainable growth for the future as part of its More Roads to Harley-Davidson plan

LinkedIn Comment on Feed

A great lesson on how to take care for the present, while future-proofing. Great brands don’t get tired of creating impressions on people, sinking them deeper into their hearts and souls; ensuring also that their veins and arteries are in sync with the brand.

You do not run a six weeks campaigns and then go to sleep, or start beating your chest that you have done something terrific, that your brand is now on everyone’s lips! People have so much in their heads, for them to keep thinking about what you do, so you must continually ‘show up’ wherever they are; even the kids need to start calling a class of products your brand name, still to your advantage.

Indomie has conquered that space here, because the unofficial name for all noodles is INDOMIE, and yet they are still running adverts. Omo and Maclean once enjoyed such ‘status’, but they have fizzled out; you have to continually shout in order to be heard.

Maybe smartphone makers, laptop manufacturers and those who are into products kids cannot enjoy at the moment, will now have something to learn from what Harley-Davidson did. You have to catch them young, and indoctrinate them as well. It’s no longer enough to have customers, you now need fans, crusaders, loyalists, etc.