E-Financial
FCMB Empowers SMEs with Training on Digital Technology, Logistics
Business owners in Nigeria have been advised to leverage on the opportunities provided by digital technology to boost productivity, service delivery and overall performance of their organisations despite the challenges posed by the Covid-19.
This was the submission of guest speakers at the second edition of the First City Monument Bank (FCMB) organised virtual capacity building programme for SMEs with the theme, “Leveraging Digital Technology & Logistics to Grow Your Business,” held recently.
The initiative was organised under the auspices of the bank’s free comprehensive capacity building programme, tagged, “Business Empowerment and Sustainability Training (BEST)’’ Masterclass and was put together by FCMB’sTraining Academy and SME Advisory Unit.
A statement explained that the online seminar, which recorded over 2,016 registered participants, focused on various topics, ranging from innovation, digital technology solutions, business model opportunities and adapting to the new normal.
The outbreak of the novel coronavirus pandemic has continued to pose alarming economic, business and commercial impact globally. It has adversely limited the ability of businesses to meet high demand of goods and services due to the restrictions and other safety measures put in place by Governments and health authorities to contain the pandemic.
However, experts are of the opinion that these challenges can be overcome with the adoption of effective digital technology solutions and logistics.
In his presentation, an Associate Partner with Mckinsey & Company, Mr. Chika Ekeji, said, though, Covid-19 is disrupting the structure of businesses across Africa, the continent can respond to disruptions with four actions.
These, he listed to include a shift in business model, sustaining business and restoring operation, shaping a whole new business and restructuring company or industry, depending on the extent of business model disruption and extent of negative demand disruption.
According to him, “some of the ways business owners can respond to this impact are, respond, return and reimagine. Across all horizon, a number of technology solutions can be leveraged to adjust SME operations to the new normal with the goal of cutting cost, sustaining revenues, reaching (new) customers, delivering on commitments, managing supply chains and innovating”.
Another guest speaker, an Associate Director of Strategy and Economics at KPMG Nigeria, Mr. Olusegun Zacchaeus, said businesses, particularly SMEs, should realign their strategies to embrace the new normal caused by the coronavirus pandemic.
He noted that this new reality presents a new set of conditions for success for SMEs and as such they must proactively adopt new strategies for survival, considering the challenging economic outlook.
He stressed that, “businesses will have to navigate the different phases of crisis maturity by responding to immediate challenges, managing through uncertainty, resetting and identifying opportunities and adapting to New Reality. The strategies for the New Reality include, building financial sustainability, manage your market to sustain revenue flows, diversify and explore new opportunities and re-evaluate your operating model plan with scenarios in mind”.
On his part, the Chairman of FASMICRO Group, Prof. Ndubuisi Ekekwe, who was a special guest said, there was need for everyone in business to evaluate why they are in business which brings the market friction between demand and supply to equilibrium.
“To stay relevant in business, business owners are required to solve market frictions and those with the acquired skills have the capabilities to release products that can overcome the frictions. If you have a great product – great things will happen,” he added.
Ekekwe added that, “The ability of business owners to serve customers and deliver goods to them can be achieved through partnership with logistics companies who leverage on technology to reach customers.
By following this model in the right way and choosing appropriate tech solutions, business owners can gain visibility, transparency and save cost, which will in turn help them stay within the marginal cost of production.”
Commenting on the BEST Masterclass, Mrs. Bukola Smith, Executive Director, Business Development of FCMB, said the bank recognises the increasing role and impact of SMEs and particularly understand the impact COVID-19 might have on their operations.
According to her, “the BEST initiative has been redesigned to meet the changing dynamics of the environment with the addition of a Masterclass. This is one of the innovative ways we empower and lay a solid foundation for the success of our SME customers.
“We believe that this initiative, which is the second edition since the outbreak of the COVID-19 pandemic, will go a long way to impact positively on business owners. We will continue to go the extra mile to create opportunities that would enable our customers succeed despite the challenges.”
Renaissance Capital Africa (Rencap) has named Zenith Bank Plc its top conviction pick among Nigerian banks, ahead of GTCO and AccessCorp, in a fresh research report highlighting the lender’s robust balance sheet and dividend potential despite sector headwinds.
Zenith Bank
The comprehensive review of the Nigerian banking industry notes that Zenith’s current market valuation lags its improving fundamentals, even as the NGX Banking Index posts strong gains recently.
Rencap upgraded Zenith from HOLD to BUY, lifting its target price by 96 per cent based on a lower risk-free rate from falling government bond yields, refined beta estimates, and expectations of cleaner assets post-forybearance resolutions.
Balance Sheet Strength Drives Outlook
Analysts project challenges to earnings growth from anticipated Central Bank of Nigeria (CBN) rate cuts but foresee higher dividend payouts from resolved forbearance and single obligor loan (SOL) exposures alongside rising cash profits.
“Although we expect banks to face challenges in growing earnings… the balance sheet clean-up… will support higher dividend payouts relative to prior years,” the report states, ranking Zenith first, followed by GTCO and AccessCorp.
Key positives include loan write-offs that bolstered asset quality, enabling sustainable growth amid financial system reforms.
Dividend Recovery in Focus
Sector profitability from 2023-2024 was inflated by unrealised foreign exchange gains, which regulations barred from cash dividends, capping payouts despite headline profits.
Zenith historically led payout ratios in 2021-2022 via strong cash generation and capital discipline; Rencap expects a rebound as pressures ease, attracting income-focused investors.
Tier-1 Leadership Reinforced
Zenith Bank recently topped Nigeria’s tier-1 capital rankings for the 16th straight year, per The Banker magazine (Financial Times), affirming its resilience and positioning for long-term value creation.
CBN
- Access Bank Plc
- Fidelity Bank Plc
- First Bank of Nigeria Ltd
- Guaranty Trust Bank (GTBank)
- United Bank for Africa (UBA)
- Zenith Bank Plc
- FCMB (First City Monument Bank) – currently pushing to raise additional capital to secure its international licence.
- Wema Bank
- Standard Chartered Bank (Nigeria)
- Citibank Nigeria
- Stanbic IBTC Bank
- Sterling Bank
- Globus Bank
- Premium Trust Bank
The Securities and Exchange Commission (SEC) has revised the minimum capital applicable to all categories of regulated capital market entities after 10 years.
The minimum capital review, according to the SEC, is informed by the need to strengthen market resilience, enhance investor protection, align capital adequacy with the evolving risk profile of market activities, and ensure that regulated entities possess sufficient financial capacity to discharge their obligations in a sustainable manner.
“The revised Minimum Capital framework seeks to: enhance the financial soundness and operational resilience of market operators; align capital requirements with the scope, complexity, and risk exposure of regulated activities; promote market stability and systemic risk mitigation; and support innovation and orderly development of new market segments, including digital assets and commodities markets,” SEC said in a January 16 circular to market operators.
The SEC circular was sent to all entities regulated by the Commission, including but not limited to core and non-core capital market operators; market infrastructure institutions; capital market consultants; financial technology (FinTech) operators; Virtual Asset Service Providers (VASPs); and Commodity market intermediaries.
All affected entities are required to comply with the revised Minimum Capital Requirements on or before June 30, 2027, the circular said.
“Entities that fail to meet the prescribed requirements within the stipulated timeline shall be subject to appropriate regulatory sanctions, including suspension or withdrawal of registration, as may be determined by the Commission,” SEC said.
Tier-1 Portfolio Managers (Full Scope) involved in the management of Collective Investment Schemes (CIS) and Alternative Investment Funds (Private Equity, Venture Capital, Infrastructure Funds etc) above N20 billion Net Asset Value (NAV), or discretionary and Non-Discretionary Private Portfolio Management Services above N20 billion Assets under Management (AuM), or exposure to foreign instruments up to 40 percent of the NAV are now required to have a minimum capital of N5 billion as against N150 million.
“Any Fund and Portfolio Manager with NAV/AuM of more than N100billion should have a minimum of 10 percent of the NAV/AuM as capital,” SEC added.
For the Tier-2 fund/portfolio managers (Limited Scope) who are in the business of management of Collective Investment Schemes with limited pooled fund creation of not more than 10 times the required capital (N20 billion) on Net Asset Value (NAV), or discretionary and non-discretionary private portfolio management services of not more than N20 billion, or those exposure to foreign instruments of not more than 20 percent of the NAV, now require N2 billion as minimum capital as against low of N150 million.
Likewise, broker-dealers whose services include: client execution, proprietary trading, margin/securities lending and advisory services no longer require N300 million minimum capital to operate but N2 billion.
The SEC said the minimum capital review from 2015 low is in line with its mandate under the Investments and Securities Act 2025 to regulate and develop the Nigerian capital market.
Also, Tier 1 issuing houses who do non-interest finance services, advisory & arrangement services but no underwriting now require N2 billion as against N200 million; while Tier 2 –issuing houses with underwriting and offers a ‘one-stop-shop’ for issuers, provides underwriting services, and renders advisory and product development services require N7 billion minimum capital for this business as against N200 million.
Also, the minimum capital requirement for brokers (client execution only) has been jacked up from N200 million to N600 million, while that of dealers (proprietary trading only) has been moved from N100 million to N1 billion.
Broker-Dealers’ (client execution, proprietary trading, margin/securities lending and advisory services) has been raised from N300 million to N2 billion, while Sub-Brokers’ (Digital) from N10million to N100million; Sub-Broker (Corporate) has been increased from N10million to N50 million. Also, sub-brokers’ (Individual) now need N10 million minimum capital for the business as against N2 million while inter-dealer brokers require N2 billion as against N50 million.
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