Passionate, driven and brilliant are some of the words that describe the Chief Financial Officer of Access Bank Plc. In the midst of his busy schedule, he was gracious enough to meet for a brief interview with Damilola Oyewusi and Oge Modebelu and took us through his journey in the Banking Industry.
By Oge Modebelu
“I went to school to study engineering. I honestly had a passion for engineering. After school, in that waiting season for a job, I had a conversation with my cousin, a Chartered Accountant. He asked me to apply for this banking job, I passed the test, aced the interview, and went to a training school for three months. I realized that all the skills I learned in engineering all came to play – logical reasoning and probability. The most profound part of the training was the lectures on the “Seven Habits of Highly Effective People” which shaped my outlook on life. Work started, and it was the environment I desired to achieve my objectives, that it was a bank did not matter.
It has been twenty years of doing what I enjoy doing most, working with the best minds in the industry. If I had to go back, I’d do this all again.”
Changes experienced in the Nigerian Banking Industry
Technology innovation is probably one of the most critical changes in the banking industry over the last twenty years or so. The business of banking is all about risk management, and with technology came a switch to consumer taste and demographics, new products and services, new geography, new channels, and new currencies. The other significant change would be regulations. To protect systemic stability, regulations have to be introduced.
Experience serving as Chief Financial Officer
Over the last ten years, the role of the Chief Financial Officer all over the world has moved to be more strategic and essentially, it is now at the heart of the business. We operate in a VUCA (Volatile Unpredictable Complex Ambiguous) world; I find fulfillment in being able to steer the organization towards achieving its objective amidst these dynamic issues.
Influence of technology and branding in Banking
Technology has changed the way we think, the way we do business, the way we manage people and the way we manage our customers. Take a look at what the FinTechs have done to the banking industry and how they have taken some market share, especially in the payment and lending section. We predicted this, and we started partnering with startups to ensure that we incubate them, accelerate them and provide as much support as we can whenever the opportunity or need arises.
Access bank and Diamond bank merger
We want to be Africa’s gateway to the world. As Africans, nobody tells our story better than us. We want to demonstrate that a truly global institution can come out of Nigeria and Africa, and this merger gets us closer to that. This combination makes us the largest retail bank in Africa; this combination gives us twenty-nine million customers and the largest channels in Nigeria. This merger harnesses the strength of Diamond Bank which is retail and the strength of Access Bank which is wholesale, which births a truly diversified bank providing to a diverse market.
The Nigerian economic predictions for 2019
The consensus that we see of the GDP is between 2.3 and 2.5. We think that the inflation will still be under 12%, it has come under pressure in the last report. On the reserve side, we believe it will stay between $42 to $44 billion depending on where the oil price swings to. We also think that if there is going to be any exchange rate adjustment, it is going to depend on the level of reserve. It’s an election year so we might not see that much at the start of the year, but as the year continues, economic activities will pick up.
On measuring value for money to be spent
We are all looking for a return on investment. Essentially how does particular money spent help the bank achieve its objective, increase revenue for the bank and improve service? Secondly, we look at if it’s an investment for the future and finally, we look out for the cost of ownership regarding determining value.
SMEs and entrepreneurs proposals
We want a reliable, executable and realistic plan. A plan that explains what value you are creating, which market you are selling to, who your competitors are, your understanding of the business, what risk is involved in this business and most importantly the passion of the promoters of the business. Finally, we ascertain whether the idea of the SME in view aligns in some way with the business that the bank does.
On startups growth constraints
The first issue has to be the financial constraints. With a high collateral requirement, a limitation to financing options and a shortage of venture capitalist companies to provide support in Nigeria, finance becomes such a challenge for young companies. The other is around management capacity, I see this every day: So, you see an IT startup with three or four staff, all they know is IT, as the company grows they don’t have systems, structures or processes, there’s no differentiation between the head of the business and the business and therefore what you find is that for a bank to lend you money would be nearly impossible, because management capacity is missing. On the policy perspective, there are two things – Infrastructure and Political Environment.
The solution to the challenge of management capacity, it is pertinent to separate the person from the business, start building up a credit history. On the business account let it be evident that there is money coming in and out because at the end of the day the bank will take this into account before being of assistance. Also, no matter how young a company is, find somebody who does the finance and accounting; I see a lot of entrepreneurs and business owners that do not know the difference between profit and cash flow.
On management capacity, it is wise to make that investment in training in building capacity, leadership and people management. As a firm starts to get bigger, technical skills begin to diminish, and these other skills take center stage.
Advice for a young professional in finance
Young professionals have to be focused and disciplined; you must be deliberate about your life. You will not succeed in anything without being focused and disciplined. Another is being a solution provider to people that come around you on a daily basis. Finance is about being solution- minded. Also, because finance is about money, you cannot afford to make mistakes, strict attention to detail is needed. Finally, you must have the ability to think strategically, not just about the present but the future.
I like football, I support Arsenal, but that is another story. I am now emotionally disconnected from the club, the last three years have been traumatic, but I guess I’m getting over it. I also like to teach, impart knowledge and I believe that I have a lot to give. I want to share this with people so they can learn and get better at what they do. I also love Corporate Social Responsibility. I think that there is a need to give back, there are a lot of people who require help and helping them brings me fulfillment.
Alternative career path
Management consulting, and the reason is the skill-set that I have, the way that I think, my ability to think under pressure, and everything that I am now, you see in a consultant.
I read a book last year, Extreme Ownership by Jonco Willink and Leif Babin. It speaks on a sense of accountability and taking responsibility. Don’t give excuses, do it. If it requires you teaching people how to do their job, get it done. Leadership is in every part of life and business. The writers are ex-Navy seals who brought their combat experience to being in business especially concerning decisions made in the battlefield. I have recommended this book to many people. You should read it too.