Finance
First Inland: Carves a niche in e-banking
By Omoh Gabriel, Business Editor
First Inland Bank Plc is an amalgam of four erstwhile banks that existed in clearly identifiable regional and market niche before the just concluded consolidation exercise in the Nigerian banking sector. They include First Atlantic, Inland, NUB International and IMB International Banks. While First Atlantic and IMB International Banks were firmly rooted in the southern part of Nigeria, NUB International and Inland Banks showed enormous strength in the North. Beside First Atlantic Bank had its operations deeply rooted in the technological space. Within a short period of its transformation from the ashes of Comet Merchant Bank, it launched a series of exotic e-banking products that took the industry by storm. IMB International Bank had a rich history as one of the earliest wholesale institutions n the market. At a time it was citadel of some sort in the Nigerian banking industry where bankers with extraordinary corporate finance skills were churned out. Not surprisingly it has produced about the largest number of CEO’s in the industry. The bank was very close to the energy sector. NUB International came with a rich cooperative banking background with substantial public sector. But on its recapitalisation in 2000, it transformed to the corporate sector especially of the Northern market.
Inland Bank likewise had the imprimateur of government support at its early stages having been incorporated by the Bauchi State government. Like NUB, it was later privatised and had to chart as independent course for itself in the corporate and consumer banking sectors under professional management. Competitively, in fact, it did not restrict its network to its original but spread reasonably to all parts of the country.
It is with this kind of pedigree that the four institutions came together to became First Inland Bank.
Naturally, the bank required time to handle the challenges of integration and is gradually emerging as a power-house in the area of development of innovative e-enabled products. This is not surprising to industry watchers.
The key legacy bank in this consolidation РFirst Atlantic Bank carved a niche in the electronic product market. In fact, it popularised the SMS mobile banking with its flagship product called Flash-me-cash which was particularly popular among the younger generation. Hence, within a period less than one year, First Inland Bank formulated repackaged about 11 products grouped into two lines РLife style and e-serve products. The later includes the enriched flash-me-cash, internet payment solution and black card. Under the life style lines are Leaders Education Account Plan (LEAP), All Purpose Investment Master Plan (AIM), First Inland Savings Account (FINSAVE), Naira Account, Extralease, Esteem, Esteem Plus and Maxicash. It is perhaps only natural to expect these products to be offered from all branches of the bank under a robust technological platform. It also recently launched an innovative payment solution called DSTV subscription card. After consolidation, the bank’s total branch network was 134, (146 presently) however due to its heavy reliance of technology to deliver its products, the bank insists about 20 million handsets and laptops of clients actually constitute its branch network.
The bank intends to leverage on this vast network, confidence and goodwill of its loyal customers to grow faster and consolidate its position as one of the top 1000 banks in the world.
In fact, following its consolidation, it in 2006 launched an ambitious 3-year medium term plan aimed to also consolidate its place among the top ten in the Nigerian banking industry. Apart from aggressive branch and channel expansion, it intends to grow asset base to N3450 billion by 2009 from the closing of N132 billion (including contingencies) as at February 2006. By October 2006, according to un-audited interim figures from the bank, balance sheet size had grown to N177 billion. Part of the strategy adopted by First Inland Bank to achieve aggressive growth in the next few years is establishment of subsidiaries, through which a lot of cross selling activities expected to generate increase business volume. Some of the subsidiaries which resulted from the integration of existing subsidiaries and units of the legacy banks includes First Inland Capital Market, First Inland Online, First Inland Mortgage, First Inland Insurance and First Inland Pension Funds. As at the time of this review, some of these subsidiaries are yet to either finalise regulating approval or resume operations.
Earning a Profitability Performance
During the period under review First Inland Bank, like several others faced enormous challenges related to integration of people, processes, products and technology. This took some sail of the wind of business expansion plans envisaged. According to interim figures for eight months period of October 2006 recently released by the bank, gross earning was about N10.31 billion which was substantially below projections made in the merger scheme.
Even when annualised this is perhaps equivalent to annual earning of N15.47 billion. However, for the 2006 financial year, the bank had estimated a gross-earnings of N21.2 billion for the post-merger entity with 71% expected from interest bearing sources. But interest income account for 61% of actual amount which though is not inconsistent with typical industry levels.
This resulted from the inability of the bank to grow risk assets as aggressively as envisaged coupled with decline in market rates.
Although management did reasonably well in controlling the rate of growth in expenses, the slow growth in the topline depressed our proxy quantitative measures of lost and earnings efficiency to 11% and 8.3 respectively during the first eight months of the period ended October 2006.
This resulted in a profit after tax of N109 billion for the period. On annualised basis, this translates to N1.64 billion or about 17k per share and 6.0% return on average equity. Although this performance reflects relative success in surmounting the challenge of the first post-consolidation year, it was certainly below the promise made during the merger process to investors.
Capitalisation and Margin of Safety
In the process of consolidation, First Atlantic and NUB International made private placements that met with reasonable success. These new cash inflows went to great length in assisting the merger process and also enabled the group meet the new minimum capital requirement. By the beginning of 2006 therefore, the new First Inland Bank started with shareholders fund of N26.48 billion, although the bank had anticipated a shareholders fund fo N46.16 billion.
By October 2006, the fund grew slightly to N28.27 billion as a result of profit generated during the period. At the beginning, this translated to 28% of adjusted Risk Weighted Assets. Though this relative measure of safety declined marginally to 25% by October, it remained well above the recommended minimum ratio of 10%. According to analysts, the bank still has sufficient latitude to expand the scope of its business. This is however without prejudice to any desire on the part of the bank to further raise funds in the near term or position itself in a better competitive situation in the market.
Quality of Assets and Liabilities
Like most banks involved in the last consolidation exercise, First Inland Bank busied itself in the last 12 months with integration issues, and this includes issues relating to asset and liability portfolios. By the end of February 2006, that is about 2 months in to the merger, the bank’s liquidity holding was so low relative to total assets at 30% but adjusted liquidity ratio was modest at 48%. By the end of October, the latter decreased to 46% while the former increased to 44%. These figures are higher but appeared too close to the minimum threshold of specified liquidity ratio of 40%.
But the overall picture of liquidity quality at the end of the period appeared slightly better than the beginning and this arose largely from a major reconstruction of the portfolio to accommodate more riskless assets and clean up the account. In fact, ratio of risk weighted assets to total assets plus contingencies responded accordingly by declining from 72% to 63% – while ratio of loan facilities to total assets declined from 42% to 35%. Although the bank in the process had to forego potential earnings but it resulted in a marginally better quality portfolio at the end of the period.
Without doubt assurance of quality is necessary to provide the needed confidence to expand business in a manner that would make for sustainable earnings performance.
Finance
Afreximbank successfully closed its second Samurai Bond transactions, raising JPY 81.8bn or $527m
African Export-Import Bank said it has successfully closed its second Samurai bond transaction, securing a total of JPY 81.8 billion (approx. USD 527 million) through Regular and Retail Samurai Bonds offerings.
The execution surpasses the Bank’s 2024 debut issuance size, attracting orders from more than 100 institutional and retail investors, marking a renewed demonstration of strong Japanese investor confidence in the Bank’s credit and its growing presence in the yen capital markets.
On 18 November, Afreximbank priced a JPY 45.8 billion 3-year tranche in the Regular Samurai market following a comprehensive sequence of investor engagement activities leveraging Tokyo International Conference on African Development (TICAD9), including Non-Deal Roadshows (NDRs) in Tokyo, Kanazawa, Kyoto, Shiga and Osaka, a Global Investor Call, and a two-day soft-sounding process which tested investor appetite across 2.5-, 3-, 5-, 7-, and 10-year maturities.
With market expectations of a Bank of Japan interest rate increase, investor demand concentrated in shorter tenors, resulting in a focused 3-year tranche during official marketing.
The tranche attracted strong participation from asset managers (22.3%), life insurers (15.3%), regional corporates, and high-net-worth investors (39.7%).
Concurrently, Afreximbank priced its second Retail Samurai bond on 18 November, a JPY 36.0 billion 3-year tranche, more than double the inaugural JPY 14.1 billion Retail Samurai issuance completed in November 2024.
The 2025 Retail Samurai bond also marks the first Retail Samurai bond issued in Japan in 2025.
Following the amendment to Afreximbank’s shelf registration on 7 November 2025, SMBC Nikko conducted an extensive seven-business-day demand survey through its nationwide branch network, followed by a six-business-day bond offering period.
The offering benefited from strong visibility supported by Afreximbank’s investor engagement across the country, including the Bank’s participation at TICAD9, where Afreximbank hosted the Africa Finance Seminar to introduce Multinational Development Bank’s mandate in Africa and its credit profile to key Japanese institutional investors.
MBC Nikko Securities Inc. acted as Sole Lead Manager and Bookrunner for both the Regular and Retail Samurai transactions. Chandi Mwenebungu, Afreximbank’s Managing Director, Treasury & Markets and Group Treasurer, commented:
“We are pleased with the successful completion of our second Samurai bond transactions, which marked a significant increase from our inaugural Retail Samurai bond in 2024, and which reflect the growing depth of our relationship with Japanese investors.
The strong demand, both in the Regular and Retail offerings, demonstrates sustained confidence in Afreximbank’s credit and mandate.
We remain committed to deepening our engagement in the Samurai market through regular investor activities and continued collaboration with our Japanese partners.”
Ecobank Nigeria, a member of Africa’s leading pan-African banking group, has announced the launch of the Ecobank SME Bazaar—a two-weekend festive marketplace designed to celebrate local creativity, empower entrepreneurs, and give Lagos residents a premium shopping experience this Detty December. The Bazaar will hold on 29–30 November and 6–7 December at the Ecobank Pan African Centre (EPAC), Ozumba Mbadiwe Road, Victoria Island, Lagos. Speaking ahead of the event, Omoboye Odu, Head of SMEs, Ecobank Nigeria, reaffirmed the bank’s commitment to supporting small and medium-sized businesses, describing them as the heartbeat of Nigeria’s economy. She explained that the Ecobank SME Bazaar was created to enhance visibility for entrepreneurs, expand market access, and support sustainable business growth.
According to her, “This isn’t just a market—it’s a vibrant hub of culture, commerce, and connection. From fresh farm produce to trendy fashion, handcrafted pieces, lifestyle products, and delicious food and drinks, the Ecobank SME Bazaar promises an unforgettable experience for both shoppers and participating SMEs. Whether you’re shopping for festive gifts, hunting for unique finds, or soaking in the Detty December energy, this is the place to be.” Ms. Odu added that participating businesses will enjoy increased brand exposure, deeper customer engagement, and meaningful networking opportunities—making the Bazaar a strong platform for both festive-season sales and long-term business growth. The event is powered by Ecobank in partnership with TKD Farms, Eko Marche, Leyyow, and other SME-focused organisations committed to building sustainable enterprises.
The Central Bank of Nigeria (CBN) has said that16 banks have so far met the new capital requirements for their various licences, some four months before the March 31, 2026 deadline. The apex bank also indicated that 27 other banks have raised capital through various methods in one of the most extensive financial sector reforms since 2004. Addressing journalists at the end of the Monetary Policy Committee (MPC) meeting in Abuja, CBN Governor Mr Olayemi Cardoso said the banking recapitalisation was going on orderly, consistent with the regulator’s expectations. He said, “We are monitoring developments, and indications show the process is moving in the right direction.” Nigeria has 44 deposit-taking banks, including seven commercial banks with international authorisation, 15 with national authorisation, four with regional authorisation, four non-interest banks, six merchant banks, seven financial holding companies and one representative office.
Cardoso explained that eight commercial banks had met the N500 billion capital requirement as of July 22, 2024, rising to 14 by September of the same year. The number has now increased to 16 as the industry continues to race toward full compliance. He said that the reforms would reinforce the resilience of Nigerian banks both within the country and across the continent. “We are building a financial system that will be fit for purpose for the years ahead. Many Nigerian banks now operate across Africa and have been innovative across different markets. These new buffers will better equip them to manage risks in the multiple jurisdictions where they operate,” Cardoso said. According to him, the reforms would strengthen the financial sector’s capability to support households and businesses. He said, “Ultimately, this benefits Nigerians—our traders, our businesses and our citizens—who operate across those regions. “It should give everyone comfort to know that Nigerian banks with deep local understanding are present to support them. Commercial banks are also creating their own buffers through the ongoing recapitalisation.”
He added that the apex bank considered several factors in determining the new capital thresholds, including prevailing macroeconomic conditions, stress test results and the need for stronger risk buffers. He reassured on the regulator’s commitment to strict oversight as the consolidation progresses. “We will rigorously enforce our ‘fit and proper’ criteria for prospective new shareholders, senior management, and board members of banks, and proactively monitor the integrity of financial statements, adequacy of financial resources, and fair valuation of banks’ post-merger balance sheets,” Cardoso said. He said the CBN remained confident that the banking system would emerge stronger at the conclusion of the recapitalization exercise, with institutions better prepared to support Nigeria’s economic transformation Banks have up till March 31, 2026 to beef up their minimum capital base to the new standard set by the apex bank. Under the new minimum capital base, CBN uses a distinctive definition of the new minimum capital base for each category of banks as the addition of share capital and share premium, as against the previous use of shareholders’ funds.
While most banks have shareholders’ funds in excess of the new minimum capital base, their share premium and share capital significantly fall short of the new minimum definition. The CBN had in March 2024 released its circular on review of minimum capital requirement for commercial, merchant and non-interest banks. The apex bank increased the new minimum capital for commercial banks with international affiliations, otherwise known as mega banks, to N500 billion; commercial banks with national authorisation, N200 billion and commercial banks with regional license, N50 billion. Others included merchant banks, N50 billion; non-interest banks with national license, N20 billion and non-interest banks with regional license will now have N10 billion minimum capital. The 24-month timeline for compliance ends on March 31, 2026. Under the guidelines for the recapitalisation exercise, banks are expected to subject their new equity funds to capital verification before the clearance of the allotment proposal and release of the funds to the bank for onwards completion of the offer process and addition of the new capital to its capital base. The CBN is the final signatory in a tripartite capital verification committee that included the Securities and Exchange Commission (SEC) and the Nigeria Deposit Insurance Corporation (NDIC). The committee is saddled with scrutinising new funds being raised by banks under the ongoing banking sector recapitalisation exercise.
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