By Emele Onu and Goddy Egene, 06.20.2010
Afribank has set a two-year turnaround plan designed to return the financial institution to optimal performance.
The plan, which was announced by the bank’s management last weekend in Lagos, followed the successful execution of the 3- 4 -7 repositioning plan, announced in 2009.The bank’s Group Managing Director, Nebolisa Arah, told journalists that the plan is divided into three stages: diagnostic (clean up and reengineering), transformation (guided growth) and consolidation.
“Afribank is currently in the guided growth stage, which commenced in April, 2010. The holistic plan is meant to put the bank on the path of sustainable growth,” said the MD.He said that Afribank has recovered N53 billion of its non-performing loans from 2009 to the current year, adding that of the total, the sum of N12.5 billion was recovered in the current year.
Afribank, he noted, exceeded liquidity ratio and other key performance indicators in the past year; improved service delivery culture and also improved relationship management with individuals and corporate customers.Arah said the implementation of the 2010 plan has started manifesting significant results in the bank, adding that the operating philosophy of the turnaround programme includes “excellence, passion and relationship management.”
In line with that, the bank said that it has continued to implement a lot of initiatives including a paradigm shift in its business architecture, technology upgrade, capacity development – skills upgrade, human capacity development, resource optimisation – optimisation of core and non-core assets as well as branch optimisation, among others.The managing director listed the achievements of the bank under the former 3- 4 -7 repositioning plan to include the institution of proper governance principles, compliance, disclosure and controls; development and implementation of a robust enterprise risk management (ERM) framework; rightsizing, rationalisation and restructuring of the bank’s business and subsidiaries and the change in the liabilities generation strategy of the bank.
“We also dealt with soft issues and weaknesses in our service delivery and culture. We followed up with a two-year turnaround plan and upgraded our branches to deliver full value through sound corporate governance structures and process re-engineering and alignment,” he said.
Afribank in its first quarter results to March 2010 posted pre- tax profit of N2 billion. The bank said the return to profitability at quarter one, compared with a loss of N39billion in the corresponding period of last year.