Nigeria: Baobab Microfinance Bank Raises Shareholders Fund to N3.9b

Jan 2020
Nigeria, January, 27 2020 - The increase followed the directive by the Central Bank of Nigeria (CBN) that all microfinance banks shore up their capital to N3.5 billion by April.

Baobab Microfinance Bank,  Managing Director/Chief Executive Officer Olanrewaju Kazeem  said the capital came from retained earnings as against its initial plan to raise the cash from rights issue.

He said:  “The Central Bank expects that by April, this year, our shareholders funds should be N3.5 billion, and a minimum of N5 billion by 2021. I am happy to say that at this point, our shareholders fund is over N3. 9 billion, coming from retained earnings.”

The bank chief said the level of profitability and growth achieved by the bank made it to go for the retained earnings option. He said the bank became fully capitalised based on the CBN requirement by last October.

He said the bank is targeting  about N6 billion shareholders’ funds by the end of the year.

Olanrewaju stated that the bank is well-prepared to support Small and Medium Enterprises (SMEs) and the economy with several products and its digital transformation.

“Today, what you can simply see is that, we are becoming a financial supermarket. For mini-micro’s, we have products for them. We talking of loans as little as N10,000 and N20,000. And then, you have the micro’s; maybe above N50,000 to like N500, 000. And then we have the Micro-Plus, which is a little above that but less than a million. And then we have the SMEs proper, which is anything above N1 million,” he said.

He said the bank disbursed loans worth N20 billion to over 62,000 customers last year. “This we expect that we are going to grow this year. Our outstanding loan book is more than N10 billion. For 2020, we are targeting nothing less than N35 billion.”

Also, he added that, till date, the bank has been able to support businesses. “About 190,000 customers have been able to access our loans, with value above N65 billion.  We expect that these numbers would go up this year, given that we would be doing what we have been doing before, and then we are bringing in technology and agency banking. So, we expect a very rapid growth,” he stated.

On the competition in the industry, he said: “We believe that we have very loyal customers and don’t think we have any issues with the existing customers, and what we are proposing to the market, giving our skills, competence and our history, plus technology that we are bringing in now, we believe that it’s going to be the market shaker for 2020. We are not afraid of going into the market if competition because we think at this moment, we would be able to deliver what we have planned.”

Source : The Nation

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