Lead Bank as a Leading Issuing House
By Uche Obike
Winning the Reuters/-SBA Best Nigerian Issuing House League Award consistently in the past few years, there is no doubt that Lead Bank Plc has proved the quality of its management reputed for innovativeness, efficiency and aggressive marketing strategies of issues in the nation's capital market.
Lead Bank Plc is one bank that has consistently defied the tough operating environment to put smiles on the lips of companies seeking to raise funds from the stock market, apparently due to the proactive management quality.
The bank is reputed for successfully assisting most of the blue chip companies to the market to raise funds.
Currently, Lead Bank is a leading issuing house to UACN Plc which
is offering 227,158,614 ordinary shares of 50 kobo each at N12.50 per share aimed at raising about N2.84 billion from the existing shareholders.
The UACN Rights Offer, which sells on the basis of one ordinary share for every four ordinary shares held as at June 4, 2004 is opened on Monday, September 20, 2004 and closes Wednesday, October 27, 2004.
The rights issue being offered is tradable on the floors of the Nigerian Stock Exchange for the duration of the Offer.
Speaking at the end of the Completion Board Meeting held recently in Lagos, the Managing Director of Lead Bank, Mr. Abimbola Olashore said that the offer was a good bargain for shareholders.
"The offer is truly attractive and an investors' delight. I believe we will help the company raise the required fund. We are confident in the offer," he said.
According to him, the major uses of the proceeds will be the allocation of 60 per cent of the net proceeds by UAC to finance the expansion of its operations in key growing businesses in line with its long term plans. The issue is also being undertaken to reduce UACN's short-term borrowings."
This impressive performance of Lead Bank as an issuing house has continued to impact positively on the financial performance of the bank.
For instance, it recently declared at its 15th Annual General Meeting (AGM)) a profit before tax of N754 million for the financial year ended March 31, 2004.
The statement of account of the bank showed that the profit increased by 22 per cent to N754 million from N620 million recorded in 2003.
The operating net income increased by 29 per cent to N1.76 billion from N1.36 billion recorded in the previous year. The bank's deposit base grew by 17 per cent to N11.7 billion from N9.9 billion in 2003, while the total balance sheet footing grew by 29 per cent to N19.57 billion from N15.11 billion in 2003.
It also declared a cash dividend of 20 per cent nominal value of shares for shareholders this year. This translated to a cash payment of N323.95 million compared with N315 paid out in 2003.
The Chairman, Oba Olashore attributed the impressive performance of the bank even in the face of unfavorable business climate to sound application of ethical principles and professionalism in the management of the bank.
"The management ensures that the bank adopts the principle of good corporate governance in all its dealing with all its stakeholders," he said.
Speaking on the recent CBN directives on bank recapitalisation, the Chairman said that Lead Bank had anticipated the need for additional capital when it called for an extra-ordinary general meeting on March 29, 2004 where the shareholders approved its right issue. "However, the new CBN directive on bank capitalisation will necessitate a review of our plans and the board has been considering various options," he announced.
An accomplished financial expert and distinguished banker himself, Olashore assured the shareholders of the bank's commitment in protecting the interest of the shareholders.
He said: "let me assure you that, any option chosen will be such that will maximally protect the interest of our depositors, shareholders and staff. We believe our franchise value is strong, as we have carved out a niche for ourselves in the market place."
To maintain a sustain growth in its performance, the bank has continued to emphasise high value on its human resources through the sustenance of its staff development programmes during the year with emphasis on skills development.
All the members of staff below officer level were frequently rotated in order to enable them to deepen their knowledge of the industry, while the more senior ones were also moved when their skills were required in other areas.
"Our policy of ensuring that all members of staff attend a minimum of one locally organised course, every six months, was also sustained. A number of management staff of the bank also attended choice overseas training during the period to further broaden their horizon," The Chairman disclosed.
On the future of the bank, Oba Olashore said that the board and management recognise that in a dynamic environment, characterised by frequent changes in government policies, there was a need to constantly review strategies in order to guarantee superior returns to all stakeholders.
According to him: "Our bank is committed to its vision of becoming a highly innovative financial institution that can withstand the volatilities in the operating environment. We shall continue to steer our business in such a focused and dynamic fashion that would reap the maximum benefits to our stakeholders."
Similarly, the Managing Director, Prince Abimbola O. Olashore disclosed recently that "we revisited our vision and mission statements to reflect the changed environment. We also changed our name by removing the word 'Merchant' to reflect the universal banking environment. Our focus remains unchanged as we remain a specialised institution with investment banking bias."
He added that "in line with the new vision, we carved out five business units, which will serve as the focal points for business. The units are investment banking, corporate banking, treasury services, private banking and asset management."
He noted that the bank's prime objective was to conclude the restructuring of Lead Bank, giving the operating business environment in Nigeria.
"We are committed towards achieving the highest level of efficiency and ensuring high productivity amongst our staff. We shall continue to pursue with tenacity, every opportunity that we believe would support growth strategy and immensely reward our stakeholders. The poor state of the economy notwithstanding, we intend to maximise the potentials of our franchise and deliver superior returns to the stakeholders," he said.
Lead Bank Plc, formerly Lead Merchant Bank Limited is a private company incorporated on February 24, 1989 under the provisions of the Companies Act, 1968. A banking license was granted to the company on March, 1989 and it commenced business on April 3, 1989.
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