Ahmed Kuru is the managing director, Enterprise Bank Limited. In this
interview, he highlights his achievements at the bank during his three-year
tenure. NSE ANTHONY-UKO captured it for LEADERSHIP
The Asset Management Corporation of Nigeria (AMCON) recently announced
the preferred and reserved bidders for Enterprise Bank Limited, bringing an end
to the bridge status of the bank. How do you feel?
I am glad that the process has come this far and we now know who the
winners, in terms of the preferred and reserve bidders, are. This is a clear
indication that the end of this bridge phase of the bank is imminent.
At the same time I am also satisfied with the outcome because it means
that we, the board and management of the bank, have been able to deliver on the
assignment given to us by the AMCON within the shortest possible time. That
assignment was to reposition the bank and make it a going concern such that it
will be attractive to investors. Right from the beginning when we came on
board, we knew our assignment was for a short period of time. As you know, our
tenure was to last for two years and Enterprise Bank was born on August 11,
2011. What this means is that we ought to have signed out on August 2013.
However, the announcement of Heritage Bank Limited as the preferred
bidder has brought that journey to a beautiful end. I am happy that the entire
process went according to how the AMCON planned it.
What are the challenges you encountered during the sale process?
It will not be totally correct to say there were no challenges during
the entire process. Yes, there were initial difficulties, but because they were
anticipated we were able to successfully manage them in such a manner that our
business was, more or less, not affected.
Essentially, the challenges had to do with the reaction of the general
public, customers and staff when the divestment process was announced. From the
very beginning, the AMCON made it very clear that the bank, by its bridge
nature, will be sold to interested investors at a certain point. When the
exercise was to begin, it announced and every step and processes involved – the
appointment of financial and legal advisers, the call for Expression of
Interests (EOIs) by bidders down to the announcement of the results were
clarified.
The reaction from customers was different immediately the divestment
exercise was announced. A little number of them wanted to withdraw their
patronage till they were sure that all was well while signing on new
transactions met with a bit of resistance. However, we deployed a number of
marketing communication strategies that succeeded in reassuring customers that
the divestment exercise will not affect their transactions.
One of such was the
organisation of customer forums where we fielded questions from the customers,
explained and reassured them that the exercise was, indeed, meant to serve them
better. There were other customer engagement strategies, including regular
media briefings, targeted at different levels of the bank’s stakeholders. We
also intensively engaged our customers on a one-on-one basis at various levels.
Our staff were equally and adequately primed through internal communication,
town hall meetings and other bonding initiative platforms to remain calm;
focused and dedicated to their work in order to convey the right attitude in
their interface with our esteemed customers.
All said, these combined strategies made every bit of the activities
during the exercise open for the awareness of every stakeholder and prompt. It
has not been easy. Like I said earlier, the industry is hostile to any form of
uncertainty and the elongated nature of the process has not helped matters. But
we thank God and our staff for all the support.
You always said that one of the principal objectives of your administration
is to deliver a sound and healthy bank to the new owners/investors at the end
of your tenure. Where are you on that promise?
We did a lot of serious work when we came on board which I believe will
endure any brand that is playing in a difficult economy like ours. The
situation we met on ground was very bad, which was why the AMCON intervened in
the first place. The first thing we did was to initiate a very strong corporate
governance structure. The bank had a 16-member board of directors, made up of five
executive directors in addition to the managing director and 10 non-executive
directors.
We operated with very credible people at this level whose experience
spanned banking, insurance, academia and public administration. The combination
ensured the institution of a very strong corporate governance structure to
avoid any abuse of process which for me was the strength of the institution. We
insisted that there must be strong operational policies. In all we did, we made
sure proper due process was followed.
The bank was not profitable at the time we assumed duties. Today, we
have returned the bank to sustainable profitability. After the initial 5-month
loss recorded in 2011, the bank has been making profit annually since 2012. We
were able to grow the balance sheet by about 36 per cent over the years. Even
with the introduction of the policy of 75 per cent Credit Reserve Ratio (CRR)
for public funds by the Central Bank which led to the relinquishing of such
funds from our system, we still have been able to grow deposits by over 30 per
cent since we took over. Our asset quality has improved greatly, leading to the
significant reduction of non-performing loans (NPLs).
The bank has been rebranded and is more recognisable in the league of
banks. We have been able to give the institution a new corporate look and feel.
Our branches and other touch points wear new look that cannot but be noticed by
the man on the street. All our customers’ touch points and service platforms
have been upgraded for better service delivery. We made huge investments in
upgrading our channels and technology to meet the demands of modern day
banking. We have continued to ensure that our customers enjoy convenient and
stress free banking as our staff have been retooled and reoriented to better
align with the vision and values of the bank.
We recognise that our staff are the most important asset that we have
and we have invested in their up-skilling and cultural renewal to enable them
competently deliver the service objectives of the bank. Their welfare has also
been of importance to us to the that extent we have ensured that their total
welfare package is competitive. Unlike what it was before now, the bank now
attracts very good staff from the industry.
So as to your question with regards to whether we came close to the
promise we made to hand over a sound financial institution to the new owners, I
will say yes, we did. We have not destroyed value; as a matter of fact, we are
leaving the bank with our heads held quite high.
After three years at the driver’s seat as the managing director/chief
executive officer of the bank, are there things you would have done differently
in the same circumstances?
Looking back retrospectively, I tell you that we were calculative with
every decision we took for the overall good of the bank. We came on board as
change managers but under a different arrangement. The whole essence of the
intervention/investment in the first instance was to safeguard staff
employment, guarantee depositor funds and ensure business continuity.
It was a tricky balancing act. We started with a highly demoralised
workforce who had seen five managements within a space of six to seven years.
It was like a 15-year “start-up” business. We were retooling and at the same
time competing. It was like joining a race with your hands tied to your back.
We had to deal with the unconventional way by beginning to untie our hands, all
in keeping faith with the government contract with the public. We are pleased
that we delivered on the government promise of preserving value.
Also to change the direction of the bank and at the same time deal with
the issue of re-branding the bank in an industry that is hostile to mediocrity
was a big challenge. One of the areas one should pay attention to in our
industry is the cost structure. Again, unfortunately, we had to deal with the
need to invest in technology, human capital and rebranding in a situation where
you are not making money.
Another tricky balancing act was on how to watch your cost to income
ratio. Therefore, we hit the ground running, excessively pushing our people,
and the fact that we were in the market did not help matters.
With the successful conclusion of the sale process of Enterprise Bank,
what would you say is the direct impact on the banking industry and the economy
vis-as-vis the situation that led to the intervention of the Nigeria Deposit
Insurance Corporation (NDIC) and the eventual takeover of the bank by AMCON?
A number of positive impacts come to mind, particularly, when viewed
against the circumstances that gave birth to the institution and two others
like it in 2011. You would recall that these banks were in terrible state and
would have been liquidated as a result of serious erosion of their
shareholders’ funds. Liquidation would have led to loss of huge customer
deposit and heavy job losses, which would also have impacted the economy
negatively. But then, the Federal Government allowed the establishment of an
institution like AMCON, which bought up all the toxic assets that weakened those
banks and reflated them with fresh capital while providing them with new boards
and management with a charge to run them profitably. As such, the successful
conclusion of the divestment exercise is a reassurance that Nigeria and
Nigerians are capable of providing solutions to our economic challenges if
allowed a level playing field. So many families have been saved the pains of
suffering the loss of their sources of livelihood. Interestingly the
institution is sold to an ongoing entity, which means quite a lot will be
preserved in the process of repositioning the institution to meet these
objectives.
Are there any regrets, whatsoever, that you may have concerning the
sale?
We have no regrets because like I said earlier, we were sent here by
AMCON for a termed or tenured assignment with set objectives of positioning the
bank for sale. That was the passion with which we operated. Nevertheless, the
reality of the situation has always been there, which somehow cushions the
pain. Right now, my greater happiness is that we delivered on that assignment
with the successful completion of the sale process. With the emergence of the
new owners, I believe and pray that our modest successes will even be sustained
and consolidated into a giant brand. That way, our little effort will always
find a place in the new brand’s history.
What would be your advice to your staff; other bankers and young
Nigerians who obviously would want to look up to you and draw some inspiration
and motivation from your accomplishments both in life and the profession?
There are two things that should be very fundamental in the mind of any
banker that is interested in retiring as a professional banker and not a
businessman. These are service and integrity. Service will entail you being
professional in your approach and putting all measures in place to satisfy your
customers, who are primarily why you are in business in the first place! It is
something that should come from inside but which will be aided by technology
and innovation. If you do not have the service attitude, no technology will
help you. Secondly, banking is a conservative old profession. Your customers
must see you as someone they can trust without any strings attached. The moment
you compromise your conduct as a banker you have lost it. It is a conflict if
you are a banker and also at the same time competing with your customers, at
times stealing their ideas. So I advise them to be interested in self
development with emphasis on service and integrity.
After this job, which, more or less, was a national assignment, you
obviously are still full of energy and not tired, what is next?
I believe in destiny, that is to say, the future is best known to God.
We are only playing out a script written by Him. Left for me I will love to be
a commercial farmer. I dream of waking up in the farm and driving a tractor
first thing in the morning. I am very passionate about anything Nigeria. It is
a great country with a lot of potentials. We are just starting. I am now like
Nigeria, waiting to be discovered. There is so much to do.
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