Oceanic Bank: Growth consistent with vision
Lanre Oyetade, Group Business Editor
Cecilia Ibru,
MD/CEO, Oceanic Bank
Oceanic Bank has emerged as one of the strongest and most stable in the post-consolidation
era of the Nigerian banking industry. Coming from top-10 position in the year 2005 to top-5 in 2006 and currently top-3, Oceanic Bank has continuously defined and surpassed very ambitious pre-set targets, with a view to becoming the number one bank in Nigeria and top-5 in Africa by 2010.
Since the consolidation exercise, the bank has continued to re-invent itself, adopting superior strategies that have consistently ensured the delivery of remarkable financial results. The growth in the bank’s profitability and other key financial ratios has surpassed the industry’s average and that of key industry players. With a consistent [quarterly] growth rate of over 100 per cent, the bank has growth more than three times its size in two years. It’s first quarter pre-tax profit of N10.9 billion is so far the industry’s highest ever by a bank in a quarter.
The bank’s first quarter 2008 un-audited result is consistent with this trend, having recorded a 143 per cent growth in Gross Earnings from N12.5bn in 2007 to N30.5bn in 2008; Profit Before Tax [PBT] growth of 154 per cent from N4.12bn in 2007 to N10.9bn in 2008, and a 148per cent growth in Profit After Tax [PAT] from N3.42bn in 2007 to N8.5bn in 2008 financial year revealing the bank’s effectiveness in cost and tax management. This is a very bold statement and a clear indicator that with Oceanic Bank, size is not a constraint to rapid financial growth.
The future outlook for Oceanic Bank is very bright. For instance, if the bank at its minimum follows the growth trend it recorded in 2007 financial year, its earnings by the end of current financial year is projected at over N150bn while its pre-tax profit will be expected to test N50bn.
Going by the bank’s antecedents, the market is confident that Oceanic Bank is capable of surpassing these expectations, especially with a reinvigorated and highly motivated management team and staff.
Stakeholders have started pouring encomiums on the leadership for this superlative performance.
Coordinator, Independent Shareholders Association of Nigeria (ISAN), Sir Sunny Nwosu, described the results as a source of joy to shareholders in the new year. According to him, it was a fulfilment of the promise made by the Chief Executive Officer of the bank, Dr. (Mrs.) Cecilia Ibru, that Oceanic Bank would out-perform competition.
Sir Nwosu said, “I am very happy about the result. It is a fulfilment of what the MD told us that the result would be very encouraging. It has shown that Oceanic Bank stands out in the industry and the prospects for shareholders are very bright.
The shareholders’ rights activists predicted that Oceanic Bank might hit a profit before tax (PBT) of N50 billion in full year if the trend is sustained.
Another shareholder, Mr. Bolaji Adeboye, commended the bank for the outstanding performance, saying that the result was an indication of what to expect in the current financial year.
According to him, “This performance is so far the best among banks that have announced their first quarter results in the current financial year. It goes a long way to tell us (shareholders) what to expect at the end of the current financial year.”
“Based on my own analysis of the results, I see the bank posting a performance that will astonish shareholders. This will ultimately lead to more capital appreciation and good dividends in the current financial year.”
A review of the bank’s result in the financial year ended September 31, 2007 bears testimony to the Oceanic Bank’s emergence as a major force in the Nigerian banking industry.
The result, which will be presented to shareholders at the forth coming annual general meeting, showed that the bank has crossed the one trillion naira mark in asset base compared to N466.5 billion recorded at the corresponding period in 2006. This represents an increase of 170 per cent.
According to the bank’s full year consolidated audited reports, Oceanic Bank recorded significant growth in all performance measurement indicators with gross earnings rising from N44.6 billion to N75 billion, indicating a 67 per cent increase. The increase in gross earnings could be attributed to the bank’s ability to take advantage of new opportunities in the domestic economy.
Oceanic Bank posted a profit before tax (PBT) of N23 billion compared to N11 billion in 2006 representing a growth of 98 per cent. With this profit level, the bank has the best profit to income ratio in the industry.
Detailed analysis of the result also showed that profit after tax (PAT) rose by 79.2 per cent to N17.5 billion compared to N9billion posted in 2006.
Following its last successful public offer, Oceanic Bank’s shareholders fund hit an all high of N222.48 billion in contrast to N37.67 billion as at the end of the preceding financial year.
Chief Executive Officer of the bank, Dr. (Mrs.) Cecilia Ibru, speaking on the results, described it as impressive and indicative of the dedication exhibited by staff and management in the financial year under review. She said that the bank’s practice of attracting and retaining the best staff in the industry was translating to superlative shareholders’ values. The bank’s proposed dividend is N1.02 as against 75k promised based on its 2007 Public Offer Prospectus.
According to her, the bank is already poised to surpass the 2007 financial year results and would continue to play a frontline role in efforts geared towards ensuring that Nigeria realises her ambition of emerging as one of the 20 top economies in the world. This is already evident in the bank’s first quarter results released recently.
Oceanic Bank’s profile has continued to rise both on the local level and the international level. It has recently been rated among the top 1000 banks in the world and has also received positive local and international rating.
Experts believe that the bank will, in the near future, become a major player in the African and the global financial market, taking its antecedents and the pace at which it is growing into consideration. For example, in the last seven years, the bank has grown its network from 12 branches as at September 31st, 2000 to 320 business offices as at 30 September, 2007. The bank currently ranks among the top four banks in the industry in terms of branch network. In the 2006/2007 financial year alone, it added a total of 135 business offices to its branch network.
With its strategic branch expansion all over the states in Nigeria and provision of one stop financial services to all its customers, Oceanic Bank possesses relevant qualities towards accelerating momentum in attaining a leadership position in Africa and creating shareholders values at all times.
In order to continually meet customers’ needs and add value to their businesses and at individual levels, the bank increased the number of its financial related subsidiaries in the last financial year. These would further enhance the bank’s goal of building a financial conglomerate and a pan-Africa outlook. The subsidiaries, which include Oceanic Registrars limited, Oceanic Trustee Limited, Oceanic Insurance Group (General & Life), Oceanic Savings & Homes Limited and Oceanic Securities Limited contributed to the consolidated reports of the bank as at 30 September, 2007.
It is envisaged that these subsidiaries, in addition to Oceanic Capital, Oceanic Custodian and Oceanic Asset Management, shall further accelerate the momentum of the group in becoming among the top three banks in Africa and a major global player with adequate capacity to exceed customers’ expectations. In the mean time, investors are continually taking position by investing in its stocks as part of their own strategy to reap from the potential progress that lies ahead.
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