Afribank Explains Non-Payment of Dividend
By Peter Egwuatu
 27th OCT 2006

Afribank Nigeria Plc has explained that it will not be able to pay dividend in the financial year ended March 2006 due to the amended provisions of Banks and Other Financial Institutions Act (BOFIA) 1999 relating to intangible asset.

According to the management of the bank, “According to Section 17(1) (a) of BOFIA 1991 as amended, disallows the payment of dividend until all intangible assets have been fully written off. As a result of this, Afribank will not pay dividend this year. The Bank has initiated several strategic moves to make the Bank a frontline financial institution- locally and globally- in the post consolidation era. The measures being employed are geared towards building profit capacity in the medium to long term, increasing clientele base, increasing investment in strategic sectors, improving efficiency, diversification of operations, empowerment of staff, streamlining and restructuring of operations among others. The desire is to make Afribank a topmost financial institution in all the essential indices”.

Commenting on the 2006 results, Head, Corporate Affairs, Afribank Nigeria Plc, Mr. Lanre Alabi, said “The sum of N744.94 million was set aside for transfer into statutory reserve as against N96.40 million in the previous year, representing 672.76 per cent”.

Analysis of the financial report for the year ended March 2006 shows that the earnings per share increased substantially from 5 Kobo in 2005 to 52Kobo in 2006, the best in the last 4 years. This underlies the quantum leap in performance.

According to Alabi, “The Bank’s strategic investment in African Petroleum Plc has positioned it for emerging opportunities in the energy sector and enables it to reap the huge collateral benefits of opening of LCs, cash collections and a host of other businesses offered by the investment”.
Afribank has entered into strategic alliance with Mr. Biggs. “To date, we have financed 30 outlets and all cash evacuation is handled by Afribank so are all other attendant businesses” he added.
The Bank has acquired the private sector deposits of Lead Bank and Assurance Bank. This immediately beefs up the bank’s deposit base and asset base. Also, through this strategy, all the 35 branches of Lead and Assurance banks have automatically become Afribank branches. Out of the 35 branches, 27 have been delivered to Afribank. Apart from this, the bank will, in the near future, open 49 new branches. This will bring the total branch network to 251.

 “Our aim is to enlarge our market share with unique market penetration strategies with clear emphasis on areas the Bank has comparative advantages. The move is to increase the worth of the Afribank brand and retain a decent market share. Our strategies are perfect brand roll out, speed to market, cost efficiency, accelerating service delivery time by 100 per cent, total customer relationship management with 24-hour access and control, total quality assurance, and comprehensiveness of IT. From day one, all our new branches will be linked on-line real-time.

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