About seven months after Access Corporation Plc unveiled its second five-year strategic plan (2023-2027) in January, 2023, the foremost financial services institution has recorded significant milestones in several areas, which points to possible early harvest of huge opportunities that the plan offers.
At the presentation of the plan to investors, the media and other stakeholder in their head office in Lagos earlier in the year, the Group Chief Executive Officer (CEO), Access Corporation, Mr Herbert Wigwe, emphasised on the section that reads:
“By the end of 2027, we expect to be in at least 26 countries and in at least 3 Organisation for Economic Co-operation and Development (OECD) countries supporting trade (United Kingdom, France & United States of America).
“The customer acquisition drive to hit 100mn for the Retail Business by 2027 will continue, as we emigrate the majority of customers to digital platforms by 2027 across touch-points.”
He added, “We want to be a global player with African heritage. We are a growth-oriented organisation and we will continue to invest in our people amid changes
Since then, Access Corporation has intensified its expansion strategy through the acquisition of whole or partial entities in banking, insurance, pension and payment services.
Recently, Access Holdings Plc and Standard Chartered Bank announced that they had reached an agreement wherein its flagship subsidiary – Access Bank Plc – will acquire Standard Chartered’s sub-saharan subsidiaries.
Under this acquisition deal, Access Bank will purchase Standard Chartered’s shareholding in its subsidiaries located in Angola, Cameroon, Gambia, and Sierra Leone.
Additionally, Access Bank will also acquire Standard Chartered’s consumer, private, and business banking business in Tanzania.
This followed Access Bank’s recent acquisition of a 51 per cent majority equity stake in Finibanco Angola.
Based on information from the company’s annual report, there are about 13 African subsidiaries with investment at a balance sheet value of about N273 billion as of December 31, 2022
The ‘new arrivals’ will join the many subsidiaries of the bank in the continent to consolidate towards achieving the target of the corporate strategic plan which was one of the reasons for transitioning to a Holco structure.
The existing subsidiaries include:
Access Bank Sierra Leone Limited
Access Bank Rwanda Limited
Access Bank Ghana
Access Bank Zambia
Access Bank South Africa
Access Bank Kenya
Access Bank Botswana
Access Bank United Kingdom
Access Bank Plc also has other smaller subsidiaries in other African countries such as
• Access Bank Cameroon with 100 per cent equity,
• Access Bank Mozambique with a 99.98 per cent stake,
• Access Bank Guinea S.A with 100 per cent equity,
• Access Bank R.D. Congo with 99.98 per cent ownership,
• Access Bank Gambia Limited with 88 per cent stake.
“The financial services institution had transitioned to a Holco with ‘5 verticals’ as a tool to capture the opportunities the African market provides as the landscape evolves over the next few years,” the plan document stated.
Experts believe that the expansion-driven investments are targeted at cornering future growth by capturing market share now, as Access Bank Nigeria still contributes over 85 percent of the profits of the banking business owned by the group.
Other subsidiaries in Nigeria include Access Pensions Limited and Hydrogen Payment Services Company Limited
A major milestone in the acquisition spree is that it boosts the asset base of Access Corporation (currently at N15.4 trillion as of March 31, 2023) which is the largest among Nigeria’s quoted firms.
Commenting on the significance of strong assets quality, Professor of Finance and Accounts at the Nasarawa State University, Keffi, Muhammad Mainoma, had told THEWILL that strong asset base is strategic to the development of any business because an enterprise is handicapped if it trades with a lean balance sheet.
“Strong asset base signifies that a business is strategically positioned to take advantage of its environment. For a bank, there is no time that people will not need money. Once a business is focused and invests in areas that people always need, it will not lose. This explains the continuous growth (in assets) despite the difficult operating environment,” Mainoma, former President, Association of National Accountants of Nigeria (ANAN), had told this newspaper in a note.
In his view, a stockbroker and head of securities trading at Planet Capital, Dr Paul Uzum, said “I think the bank is doing the right thing. Diversifying from an economically unstable country like Nigeria, will give the bank a pan-African outlook, with a more robust balance sheet. You can see how the EPS (earning per share) and DPS (dividend per share) of the bank has been rising over the last 3 years since they went global.”
Access Bank sees this acquisition trend as an opportunity to build a robust global franchise focused on serving as a gateway for payments, investment, and trade within Africa and between Africa and the rest of the world which is in line with its strategic plan.
Commenting on the deal with Standard Chartered, the Managing Director of Access Group, Roosevelt Ogbonna said:
“For Access Bank, this strategic transaction represents a key step in its journey to build a strong global franchise focused on serving as a gateway for payments, investment, and trade within Africa and between Africa and the rest of the world, anchored by a robust capital base; a relentless focus on execution; and best-in-class customer service & governance structures.
“At Access Bank, we are committed to reshaping the global perception of Africa and African businesses, even as we continue to build toward our vision to be the World’s Most Respected African Bank.
“Our 5-year growth plan will see us build a world-class class payments gateway leveraging the power of technology and a robust network of relationships across our operating countries. This will be supported by a dynamic ecosystem of local and international partnerships, enabling us to serve global payments and remittances efficiently.
“With our recent European expansion and our deepened presence in key trading corridors across Africa, we will bridge the gap between cross-border and domestic transfers across all business segments. More importantly, we are committed to impacting our host communities positively.”
With this move, Access Bank, which is already Nigeria’s biggest bank by asset, will see its value skyrocket as it takes a more prominent position in the African banking scene. Its topline and bottom-line performance has been impressive.
Profit after tax has risen by 108.5 percent in the last three years from N90.1 billion in 2020 to N166.6 billion in 2022. Total assets increased to N12.53 trillion in 2022 from N7.62 trillion in 2020. The Q1 2023 report showed that the group’s assets climbed to N15.74 trillion against N14.99 trillion in Q1 2022 representing an increase of 5 percent.
Gross earnings hit N1.1 trillion in 2022 from N734 billion in 2021, while earning per share (EPS) accelerated to 469 kobo from 314 kobo in the preceding year, and dividend per share (DPS) climbed to N1.60 kobo from N1,00k in 2022 and 2021 respectively, indicating continued growth under the strategic plan.
Since the acquisition of Diamond Bank in 2018, Access Bank’s assets have remained topmost in the industry.
The financial services institution had transitioned to a Holco with ‘5 verticals’ as a tool to capture the opportunities the African market provides as the landscape evolves over the next few years.
“Access Corporation’s ambitions will be supported by 7 key enablers. These enablers will ensure Access executes seamlessly, becoming a Top 5 financial services institution in the Continent by the end of the strategic cycle in terms of revenues, asset base and on a balanced scorecard basis,” the document revealed.
About the Author
Sam Diala is a Bloomberg Certified Financial Journalist with over a decade of experience in reporting Business and Economy. He is Business Editor at THEWILL Newspaper, and believes that work, not wishes, creates wealth.
