Waheed Olagunju, executive director, Bank of Industry, BoI, speaks extemporarily at Realnews fifth anniversary lecture #Realnews5thAnniversaryLecture

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‘Leadership in Institutions like BoI,’

 

MINE is just to relate my experience to what we have been listening here all along. Madam Oby Ezekwesili talked about using strong, competent and capable people, who have capacity to build institutions. The institutions will outlive those individuals and be able to deliver effectively on their mandate and make effective contributions to national development.

I bear witness that Bank of Industry in the last 16 years stands out as a Nigerian institution that has been restructured by very competent, efficient and capable Nigerian leaders. The MD of AMCON what he described the business environment last year 2016 in particular, according the CBN, FSS report because of the recession, the nonperforming loans went up to 14 percent. This was above the CBN threshold of five percent.

And many banks are having it very rough. However, that year has gone down in history as the BoI most successful year in operation. In 2016 we recorded highly impressive returns double digits in some instances. We are a Development Financial Institution, DFI. Most DFI in Africa operate at losses. They are lost-making institutions. But last year we recorded a 42 percent increase in our operating profit from N11 billion in 2015 to N17 billion in 2016.

Regarding our mandate, which is developmental impact of our total loans went up by 10 percent from N151 billion to 176 billion and about 800 enterprises that have potentials of generating about a million jobs. So, these are the developmental impacts. Our loans to SMEs also went up by 42 percent from N5.6 billion in 2015 to N8 billion in 2016.

I mentioned these figures to let you know that the journey to 2016 did not just start in a day. The Bank of Industry came into existence in the form which it is today in 2001, when it was constructed from the former Nigerian Industrial Development bank, NIDB, that was incorporated in 1964. So, in this period of time up to 2001, NIDB was only there for the name. As a result of the reconstruction that took place under the Obasanjo administration it started with the process of appointing the leaders.

President Obasanjo felt that he wanted the best human being to run the Bank of Industry, so he was ready to recruit expatriates. In other words, going back to 1964 when the NIDB was established with the help of International Financial Corporation, IFC. A staff of IFC called James Large was the first chief executive of NIDB.

However, it didn’t get to that. An advert was placed and Nigerians applied, they were interviewed and Dr Lawrence Osafina came first at the interview and he was given the job. He ran the bank for about four and half years, from 2001 August to 2005 December. Then Miss Evelyn Oputu was appointed the managing director and she ran the bank between 2005 December to April 2014.

Then in 2014, I acted as the managing director for two months. Rasheed Olaoluwa was eventually appointed the managing director. He was MD until February 2016 and again I had the responsibility of running the bank from February 2016 to May 2017.

Over this period of time, all the chief executives made wonderful contributions to the bank. And each of them left the bank stronger than they met it. Many of you cover the Bank of Industry and you reported on the performance. What is clear is that it is possible in our life time as Nigerians to take the bull by the horn if and when we decide to.

If we could do it in BoI that means it can be done in many other institutions. What we need is many BoIs across the country in terms of state owned enterprises. The methodology in the BoI module is what should be adopted in other states owned enterprises. If major is owned by the government but in terms of operations it should be private sector driven and we benchmark ourselves in terms of global standards, international best practices.

Today the Bank of Industry is best rated according to Fitch Ratings. Is the best rated Nigerian bank wholly owned by Nigerians and managed by Nigerians. The rating is AA+. It is only one commercial bank that has triple A according to Fitch and that commercial bank has sole ownership and some foreigners are also involved in the management of the bank.

We are also rated AA1 by Moody’s and AA- by Agusto Ratings. If a Nigerian own institution owned 51 percent by the Ministry of Finance and 40 percent CBN and 42 other minority Nigerian shareholders can transform a state owned enterprise into one of the best on the African continent, all hope is not lost for us in this country.

As you heard and like my brother (Ahmed) Kuru said leadership particularly in Nigeria can be a very challenging role. One thing all of them have mentioned up till now is that our leaders need prayers. I have the opportunity of working with six managing directors closely. I can tell that leadership can be very challenging and unless you are close to God and believe in God, you may not succeed.

 

– Nov 17, 2017 @ 14:12 GMT |

 

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