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Fitch Upgrades Coronation Merchant Bank Rating to ‘B-’, Outlook Stable

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Fitch Ratings has upgraded Coronation Merchant Bank Long-Term Issuer Default Rating (IDR) to ‘B-2’from ‘CC’ and its Viability Rating (VR) to ‘b-’ from ‘cc’.

Fitch has also upgraded the bank’s National Long-Term Rating to ‘BBB-(nga)’ from ‘B+(nga)’, with the Outlooks on the Long-Term IDR and National Long-Term Rating rated Stable.

The upgrade reflects the robust improvement in the bank’s capital position, following the completion of a rights issue and the sale of foreign currency-denominated equity investments, a statement on the ratings stated.

Fitch, noted that the substantial upgrade reflects the agency’s view that funding instability risks had receded, due to the strengthening of Coronation Merchant Bank’s capital base.

The ratings agency also attributed the assessment to an improvement in the bank’s core profitability, aided by the softening of the Cash Reserve Ratio (CRR) regime for merchant banks.

“Coronation Merchant Bank Limited’s Issuer Default Rating (IDR) is driven by its standalone creditworthiness, as expressed by its VR of ‘b-’. The Viability Rating (VR) balances the concentration of Coronation Merchant Bank’s operations in Nigeria’s challenging operating environment, a niche franchise and business model, high credit concentrations, moderate capitalization and its reliance on short-term wholesale funding against good asset quality metrics,” the rating agency further stated.

Fitch also highlighted the bank’s strong asset quality metrics, noting that “despite challenging macroeconomic conditions, Coronation Merchant Bank has recorded no impaired loans since converting to a merchant bank in 2015, reflecting its prudent underwriting standards and risk controls, and the lower-risk nature of its trade finance loans.”

Paul Abiagam, Deputy Managing Director of Coronation Merchant Bank, commenting on the upgrade, said: “Our unique 4-step upgrade in both ratings by Fitch is a testament to the progress the Board and Management have made in directing and executing strategic initiatives, that have effectively reinforced our financial stability and operational resilience.

“It reflects the hard work and dedication of our entire team and underscores our shared devotion to maintain high standards of financial management and deliver exceptional value to our stakeholders.”

The statement said that inspired by Founder, Aigboje Aig-Imoukhuede’s vision and leadership, Coronation Merchant Bank remains focused on leading Africa’s merchant banking subsector.

It further noted that despite sectoral headwinds and a challenging economic environment, the bank delivered an exponential increase in Profit Before Tax (PBT), to ₦3.48 billion in 2023 financial year, maintaining a triple digit quarter-on-quarter growth to ₦1.40 billion in Q1 2024.

It said this enhanced performance also reflects the successful efforts of the Board of Directors led by Chairman Mr. Tunde Folawiyo to strengthen the Bank’s executive leadership team with strategic appointments including Deputy Managing Director Paul Abiagam, Chief Financial Officer Arini Awotunde, and Chief Risk Officer Saheed Alamutu, amongst others.

“These additions to the executive team continue to drive the bank’s growth, while reinforcing its commitment to excellence in risk management, financial oversight, and overall corporate governanc”, it added..

The statement said the rating upgrade underscores the Bank’s commitment to excellence, prudent financial management, and its resolve to create sustainable wealth across Africa.

 


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E-Financial

NDIC, EFCC Begin Investigation of Directors, Staff of Heritage Bank

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Nigeria Deposit Insurance Corporation (NDIC) has said it will, in conjunction with law enforcement agencies, commence investigation of directors, managers and staff of the defunct Heritage Bank following its liquidation over a month ago.

NDIC, EFCC Begin Investigation of Directors, Staff of Heritage Bank

Mr Bello Hassan, managing director of NDIC, stated this at the 2024 capacity building workshop for law enforcement agencies on ‘Inter-Agency Collaboration in the Fight Against Financial Malpractices in Banks and Other Financial Institutions in Nigeria’ in Lagos yesterday.

Stating that, those behind the collar of the bank will be brought to book, Hassan, who was represented by Mr Bello Hassan, NDIC’s director, Corporate Communications,  noted that, through its collaboration with law enforcement agencies, 14 prosecution cases are ongoing at various courts, 18 ongoing investigation with FMIU, 8 with EFCC and 9:concluded investigations with Federal Ministry of Justice for advice and prosecution.

“The Central Bank of Nigeria recently revoked the banking licence of Heritage Bank PLC which may require you to be called upon to investigate some of the Directors, Managers and officers of this failed insured Institution with a view to bring to book those found culpable in the collapse of this institution.

“The Corporation as a key participant in the financial safety-net, has over the years taken the fight against insider abuses and financial malpractices in banks very seriously. As you all know, a safe and sound banking environment is an essential ingredient of financial system stability which of course is the bedrock for economic development of every nation.

“We are not unaware of the challenges of investigating and prosecuting financial malpractices and bank fraud cases but wish to urge you not to relent in your efforts and be rest assured of our unflinching support at all times,” he pointed out.

Hassan noted that, the theme of the workshop ‘Effective Collaboration as a strategy in the fight against insider abuses and financial malpractices in Banks and Other Financial Institutions in Nigeria’ was to re-echo its resolve to unite with law enforcement agencies in the “fight occasioned by the menace of insider abuses and financial malpractices which is a major cause of bank failure, and if not tackled is  capable of eroding public confidence in our banking system.

“Consequently, and in line with Article 12 of the Core Principles of Effective Deposit Insurance which provides for every Deposit Insurer to put in place the necessary mechanism of bringing to book parties found culpable in the failure of their bank or financial Institution.

“It is for this reason that the NDIC has been consistent since 2012 in organising this workshop to sharpen the skills of law Enforcement operatives and Officers from Regulatory Agencies that are involved in the investigation and prosecution of bank Directors, Managers and staff of banks involved in malpractices and insider abuses that might have led to the collapse of their banks or financial Institutions.

 

“Change is the only constant thing in life. Most changes in human endeavours come through developments in sciences, technology or innovation. As the banking system is rapidly evolving with new innovations, it is clear that a new phase of financial technology driven economy is currently reshaping the global financial services space.

“With this development, the criminally minded users of the banking system including the notorious ‘’cyber criminals’’ are busy perfecting their misplaced skills and that is why workshops like this are necessary to enable law enforcement officers to understand, accept and adapt to the dynamic operating environment.”

 

 

 

 


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E-Financial

PalmPay Makes Payment Easier with Zero Bank Transfer Fees on All Transactions on the Fintech App

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In its continued drive to financial inclusion across Nigeria, leading fintech company PalmPay, continues to give its users unlimited free transfers to all banks. This feature which was introduced earlier in the year has been allowing users to make transfers to all banks within the country without incurring any bank fees.

Chika Nwosu, PalmPay’s Managing Director, stated: “We are committed to ensuring smooth and easy transactions with our free transfer feature. This shows our dedication to providing accessible and affordable financial services to our over 30 million users and every Nigerian. We believe everyone should have access to affordable financial services.”

PalmPay is dedicated to driving economic empowerment in Nigeria by offering top-tier products such as money transfers, bill payments, credit services, and savings through its app and mobile money agents. Users can send and receive money seamlessly, pay bills effortlessly, shop with ease, and earn discounts and cashback while performing these transactions.

By eliminating transfer fees to all banks on its app, PalmPay has empowered its millions of customers to enjoy endless fund transfers to family and friends, pay their bills seamlessly, and manage their finances more effectively.

PalmPay is a leading Africa-focused fintech platform committed to driving economic empowerment in Africa. Through its secure, user-friendly, and inclusive suite of financial services, PalmPay brings top-tier products into the pockets of everyday Nigerians. With this, we are able to drive financial inclusion.

PalmPay offers money transfers, bill payments, credit services, and savings on its app and via its mobile money agents. Since launching in Nigeria in 2019 under a Mobile Money Operator license, the platform has grown to over 30 million app users as part of its cashless payment ecosystem.


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eTranzact Powers Military Pensions Board’s New Digital Verification System

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eTranzact, innovative financial technology solutions company, has announced its role as the technology solution provider for the Military Pensions Board’s new digital verification system for military pensioners, officially launched on July 1, 2024.

eTranzact Powers Military Pensions Board’s New Digital Verification System

In a press statement, the company said that the initiative marks a significant milestone in leveraging technology to streamline pension verification processes and enhance the welfare of military retirees across Nigeria.

It also stated that, with Federal Government approval, the Military Pensions Board is transitioning from traditional physical verification methods to an advanced electronic system developed and deployed by eTranzact.

“This transition aims to minimise travel risks, reduce transportation costs, and accommodate the advanced age of many pensioners.”

According to the statement, Air Vice Marshal Paul Irumheson, chairman of the Pension Board, said the necessity of this transition to electronic verification is crucial for the safety and convenience of military pensioners.

“This innovative solution will ensure that retirees can verify their status from anywhere in the world, significantly reducing the burden of travel and associated risks.

“The successful pilot exercise conducted between February 15 and March 1, 2024, demonstrated the efficiency and reliability of the new system. In addition to developing the verification system, eTranzact has managed salary payments for other government agencies.

“The implementation of this electronic verification system is a critical step towards ensuring foolproof and seamless payment processes within the Military Pensions Board.

“The Minister of State for Defence, Dr Bello Matawalle, and the Chief of Defence Staff, General Christopher Musa, have endorsed the electronic verification exercise, recognising its potential to revolutionise the military pensions system.”

The statement further explained that the “key benefits of the digital verification system include enhanced security by reducing the risk of identity fraud and impersonation, convenience by allowing pensioners to complete verification from their homes, cost efficiency by eliminating the need for travel, and accessibility by accommodating pensioners residing both within and outside Nigeria.

On his part, Niyi Toluwalope, chief executive officer of eTranzact, expressed enthusiasm concerning the partnership for digitalized pension processes.

“We are honoured to collaborate with the Military Pensions Board on this transformative project. At eTranzact, we are committed to harnessing the power of technology to solve critical challenges and improve the quality of life for Nigerians. This digital verification system affirms our dedication to innovation and excellence,” the statement reaffirmed.


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