VFD Group Seeks Commercial Banking Licence

banking - June 1, 2021

The VFD Group Plc has stated that it will intensify its quest to obtain a commercial banking licence from the Central Bank of Nigeria (CBN) before the end of 2023.

In addition, it said it is on the verge of establishing a global remittance business that would allow it expand its offering within the foreign exchange and currency exchange business.

It also stated that it would refocus its VFD Microfinance Bank to a full digital banking entity that would offer diverse innovative financial solutions to its esteemed customers.

These were disclosed yesterday by the Group Managing Director/Chief Executive Officer of the VFD Group, Mr. Nonso Okpala, during the group’s fifth Annual General Meeting (AGM) held in Lagos.

Okpala said: “While we are yet to conclude our plans of acquiring a commercial bank license and an insurance company, we are well placed to achieve these way ahead of the timeframe of 2023.

“Our application for a commercial banking license remains in the works and at an advanced stage. We are in constant engagement with the regulatory authorities, and we would provide update to all stakeholders as we make progress.

“Learning from the past 12 months, it is instructive that we refocus our customer facing businesses to become dynamic, leveraging technology to create omni-channel experience that will meet our customers’ needs while allowing us to be lean and efficient.

“Hence, our micro-finance bank will begin the transition to a full digital entity offering diverse innovative financial solutions to our esteemed customers.”

He said the group’s “conversations with a UK-based remittance company are at an advanced stage and we hope to conclude this in the second quarter of 2021.”

The group managing director said the group delivered on all key financial indicators in 2020 to validate its strategic direction.

Okpala said the major factors that contributed to the performance were the group’s investment income from its Eurobond portfolio, interest income from lending activities, earnings from other subsidiaries and foreign exchange valuation gain.

He said: “We did quite well this year largely from our treasury activities as well as income from subsidiary companies. The dividend was our way of expressing appreciation to our shareholders for their support.”

The Chairman of the VFD Group Plc, Mr. Olatunde Busari (SAN) declared that the group has set aside dividend of N1.014 billion to reward its shareholders with the payment of a dividend of N8.51k per share for 2020 financial year that ended on December 31, 2020, compared to N3.30 it paid in 2019.

Busari said gross earnings grew by 97 per cent to N6.7 billion in 2020, as against the N3.4 billion earned in 2019, while the group’s profit before tax grew year-on-year by 173 per cent to close at N4.1 billion in 2020 compared to N1.5 billion it recorded in 2019.

He also said the group’s total asset grew by 85 per cent to close at N81.7 billion within the year under review, as against the N44.2 billion recorded in the preceding year.

Busari, however, summed up the group’s business experience in 2020 as, “Navigating a very uncertain world,” saying that the group’s vision in 2021 was to become a commercially viable proprietary investment company with global influence by focusing on building positive and socially conscious ecosystem.

Busari said: “We have delivered yet again other record levels of revenue and profit. Year 2020 has been a tough year but fortunately we are able to wade through the tide as you know that we have multiple investments in the Nigerian financial sector and were able to declare dividend of N8.51 per share. The shareholders are happy that the company did very well and I commend the management of my company.”

The VFD’s Group Financial Controller, Mr. Folajimi Adeleye, attributed the success the group recorded in 2020 to activities that fetched it interest revenues. “But we also did a lot of treasury activities. We maintain a positive outlook for 2021 even though we expect it to be tough and we are going to focus more on risk management.”

A shareholder, Ms. Karem Abah, said that she was amazed that the group could pay us N8.51 dividend per share considering the challenges businesses faced in 2020, adding: “I am really happy and impressed with the result.”

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