Akinsola Akinfemiwa

Akinsola Akinfemiwa

Akin

Akinsola Akinfemiwa is a man who established good track records in banking in Nigeria, convincing enough for his contemporaries to make a way for him to take the lead. Before the banking industry consolidation policy came into effect in 2004, he provided the leadership in Prudent Bank that gave the bank a rallying point in the consolidation.

Prudent Bank was a N1 billion bank in 2000 but at the time of banking consolidation exercise in the mid 2004, its asset base had jumped to nearly N26 billion. Over the same period, its gross earnings had expanded from N185 million to N5.3 billion. The bank grew profit every year from N41 million in 2000 to N610 million in March 2004. These represent some of the fastest growth indices in the Nigerian banking industry during the period.

Through hard work and prudential leadership, Akinfemiwa succeeded in transforming the small bank into a formidable financial institution in a position to provide leadership to other members of the consolidating banks. He is one of the leading bank chiefs who successfully navigated their institutions through the strenuous banking sector consolidation programme in 2004/5.

He clearly had an edge over his contemporaries in the appointment of a managing director and chief executive officer of Skye Bank, which emerged from the consolidating group. He was obviously the popular choice for providing the central plank on which the merging banks were able to build one of the 25 banks that scaled through the Central Bank’s minimum equity hurdle of N25 billion.

Akinfemiwa served as the chief executive officer of Skye Bank from its post consolidated operations until the end of July, 2010. He put in over 28 years of professional service in the banking industry. His areas of expertise include strategic planning and management, corporate banking, project financing and advisory services.

He hails from Ondo State and had a distinguished course work at the University of Nigeria, Nsukka, between 1972 and 1976. He emerged in a second class (upper) degree in agricultural economics. In 1978, he proceeded to the University of Ife where he obtained a masters degree in business administration.

He began his working career at British Petroleum in 1978 as a management trainee. He later moved to Peat Marwick, AniOgunde and Co. in 1980 as audit officer. From there, he crossed over to banking and started off at International Merchant Bank as a senior manager. He later moved to Chattered Bank and from there to Prudent Bank. He provided able leadership to Prudent Bank until banking consolidation led to the birth of Skye Bank.

In the new bank, he earned the respect of chief executive officers of the other consolidating banks and was given the mantle of leadership of Skye Bank. The post consolidated position of the bank in 2006 showed an asset base of N174 billion, total deposits of over N125 billion, an equity standing of N25.6 billionand a retail branch network of 156.The bank generated gross earnings of about N21 billion in 2006 and an after tax profit of under N2 billion.

There were serious challenges in the post consolidated operations arising from the forced amalgamation of different banks. Skye Bank clearly didn’t have the operating advantage that banks that retained their brand identities had in the post consolidated trading. Its management therefore needed to put in the extra mile effort that an entirely new institution normally requires to find its feet in an industry.

A reasonably large volume of financial resources had been pulled together and there were also varied human resource skills at the bank’s command. What was then required was the creation of an effective framework to harness these resources, exploiting the economy of scale benefits provided by consolidation. A strong leadership of the new institution was needed to create a structure that quickly levels off the old individual entities and builds a new brand identity with a new drive and a new vision.

It was imperative to tackle the problem of differing risk asset quality conditions pulled together in the consolidation in order to lay a solid foundation for growth. An effective utilisation of the expanded branch network was required to enable the bank reduce its average cost funds. A cost-income management initiative was needed to drive revenue growth and improve the ability to convert earnings into profit.

Akinfemiwa turned out to be all that the new bank needed to deal with its challenges and act decisively on its strengths and opportunities. He succeeded in placing the bank on a high growth track that made it rank among the fastest growing banks in the industry.

He maintained triple digit growths in profit and in the size of the balance sheet with asset base soaringby 157%to over N446 billion in 2007. A major expansion in the volume of earning assets took place in the post consolidated operations of the bank, which enabled management to raise revenue capacity significantly. There was an all round cost moderation, which enabled the bank to achieve a big leap profit margin.

Gross earnings advanced by 89% to N40 billion in 2007, showing a strong improvement in the average yield of assets. An average interest yield on loans and advances of about 21% in 2007 was one of the highest efficiency records in the banking industry in that year.

Akinfemiwa developed a strong risk management expertise that equipped the bank to grow commercial and consumer lending projects rapidly with minimum adverse impacts on provisioning and credit quality. After building up an adequate reserve for credit losses, he carried out a loan portfolio clean up exercise in 2007 in which non-performing loans were cut down by 68.8% against a 32% growth in the gross risk assets volume. With that, the percentage of classified loans sank from 22.6% in 2006 to 5.3%, giving the bank a clean slate on credit quality. The risk posed by impaired assets to equity resources was eased off and the bank was positioned for rapid growth.

By the time Akinfemiwa left the bank in 2010 in compliance with the tenure policy of the Central Bank, he had built an asset base of about N693billion, a net credit portfolio of over N405 billion and a deposit portfolio of about N511 billion. He built an equity cushion of over N103 billion and achieved gross earnings of about N84 billion.

More importantly, he navigated the bank through the financial crisis during which some of the banks that emerged from the banking industry consolidation fell along the way. Skye Bank was one of the few banks that didn’t taste a loss in the two years of financial crisis. Despite a 947% rise in impairment charges for loan losses in 2009, the bank ended the 15-month financial year with a bottom line at break-even level. Its loan loss reserves were not significantly depleted and that made recovery easy for the bank in 2010.

Akinfemiwa’s outstanding accomplishments in nursing a new brand to maturity have paved the way for him to return to the industry as chairman of Heritage Bank just a few years after he left the banking scene. His expert guidance is clearly needed in the bank’s integration process after the acquisition of Enterprise Bank Ltd and in positioning the new bank on a firm pedestal for rapid growth.His versatile expertise in business strategy, corporate structuring, risk management and project finance are highly needed by the young bank desirous to grow. All eyes are on him to replicate the success of Skye Bank in the newcomer – Heritage Bank.