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Global Rankings as Affirmation of Nigerian Banks

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  • Global Rankings as Affirmation of Nigerian Banks

With the ranking of five Nigerian banks, especially FirstBank, which has been named the number 1 Banking Brand in Nigeria for the sixth year in a row, Raheem Akingbolu reckons that Nigerian banks have indeed become global brands.

Like all breakaway brands, First Bank, GTBank, Access Bank and Zenth Bank, have consistently formed emotional connections with the banking audience. These brands owners understand the roles the brands play in the lives of consumers and make sure their banks’ attributes match up with the target banking public. For instance, for over 100 years, promoters of First Bank, like handlers of other global brands like Coca Cola and Pepsi, think of new ways to keep the brand top-of-the brand.

Few weeks ago, First Bank of Nigeria Limited was again named as the most valuable banking brand in Nigeria in The Top 500 Banking Brands of The Banker magazine of the Financial Times and Brand Finance, London, United Kingdom for the sixth consecutive time. In many quarters, observers see the feat as an evidence of the global status of the brand. In a country, where the mortality rate of businesses is high, First Bank has existed for over 10 decades.

In a statement issued recently by the Country Representative – Nigeria of The Banker magazine, Mr. Kunle Ogedengbe, First Bank leads four other Nigerian banks in the global ranking. With $301 million brand value, First Bank ranked 357 leads Guaranty Trust Bank ranked 395 with a brand value of $258 million, Zenith Bank ranked 414 with a brand value of $247 million, Access Bank ranked 476 with a brand value of $182 million and the United Bank for Africa with a brand value of $172 million ranked 487 in the world.

Beyond the figures, another major strength of the bank is its continued drive to lead innovative drive in the banking products, services and initiatives as well as strive to maintain the highest standards of performance expected of a global brand that we are. This was confirmed less than a year ago when the bank was officially recognised as the first financial institution in the country to achieve a transaction volume of 100 million transactions in a month by Interswitch Transnational -Africa’s leading integrated payment and transaction processing company.

According to the Interswitch, this milestone feat was achieved in the month of December 2015 and represented the total transactions processed by FirstBank’s Front End Processor running on the Interswitch transaction switching platform which seamlessly links all financial institutions in Nigeria to facilitate better and quicker transactions across all platforms.

In the breakdown of the latest ranking exercise, the top ten banking brands ranking in the world are shared by four countries: China and United States of America with four each while United Kingdom and Spain have one each.

The remaining eight banks in the top ten are China Construction Bank, Chase (JP Morgan & Co of the USA), Bank of China, Bank of America, Agricultural Bank of China, Citibank (USA), HSBC (UK), and Satander (Spain) noted Macknight.

In the top 50 countries in the world, only four African countries made the list. These are South Africa (26), Nigeria (42), Egypt (46) and Morocco (47).

According to the February 2017 edition of the magazine, First Bank is however the only Nigerian bank in the top 10 banking brands in Africa along with nine others banks from South Africa, Egypt and Morocco.

Methodology

As for the methodology of the ranking, “Brand Finance employs a discounted cashflow technique to discount estimated future royalties at an appropriate rate to arrive at a net present value of a bank’s trademark and associated intellectual property – its brand value”, noted Brian Caplen, the editor of The Banker.

Caplen stressed that the process involves five steps of obtaining brand-specific financial and revenue data; modeling the market to identify market demand and the position of individual banks in the context of all other market competitors; establish the royalty rate for each bank; calculate the discounted rate specific to each bank, taking account of its size, geographical presence, reputation, gearing and brand rating; and discount future royalty stream (explicit forecast and perpetuity periods) to a net present value – the brand value.

He noted that the approach is used for two reasons: it is favoured by the tax authorities and the courts because it calculates brand values by reference to documented third-party transactions and it can be done based on publicly available financial information.

Globally, deputy editor of the magazine, Joy Macknight stated that Industrial and Commercial Bank of China is number one with a brand value of $47,832 million followed by Well Fargo of the United States of America with a brand value of $41,618 million.

From any area one chooses to look at the award, it is a clear indication that FirstBank has continued to lead the pack and consistently outperform others despite economic headwinds. This is indicative of the creativeness of the FirstBank Team.

Imports of the recognition

Reacting to the award, the Head of Marketing & Corporate Communications and General Manager at First Bank of Nigeria Ltd, Mrs. Folake Ani–Mumuney said the management was extremely excited to have been named the Most Valuable Bank Brand in Nigeria six consecutive times. While appreciating the contribution of the brand’s patrons to the success story, she pointed out that amidst the economic turbulence of 2016, it was still an eventful year for the bank as it hit a number of milestones.

“In 2016, FirstBank clinched the “Best Retail Bank in Nigeria” award by The Asian Banker for the fifth consecutive time; we were recognised by Interswitch as the first financial institution in the country to achieve sustained transaction volumes of 100 million transactions twice in one year; our mobile banking platform –FirstMobile – recorded a milestone in its user numbers with the attainment of 1million active users and also reached N1.3trillion transactions mark in its short period of launch.

FirstBank also became the first financial institution in Nigeria to achieve the latest version of ISO quality standards: the Quality Management Systems certification ISO 9001:2015 from the International Standards Organisation (ISO). The certification is proof of the Bank’s demonstrated ability to consistently provide products and services that meet customer needs as well as applicable statutory and regulatory requirements,” she said.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Crude Oil

Oil Prices Continue to Slide: Drops Over 1% Amid Surging U.S. Stockpiles

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Crude Oil

Amidst growing concerns over surging U.S. stockpiles and indications of static output policies from major oil-producing nations, oil prices declined for a second consecutive day by 1% on Wednesday.

Brent crude oil, against which the Nigerian oil price is measured, shed 97 cents or 1.12% to $85.28 per barrel.

Similarly, U.S. West Texas Intermediate (WTI) crude slumped by 93 cents or a 1.14% fall to close at $80.69.

The recent downtrend in oil prices comes after they reached their highest level since October last week.

However, ongoing concerns regarding burgeoning U.S. crude inventories and uncertainties surrounding potential inaction by the OPEC+ group in their forthcoming technical meeting have exacerbated the downward momentum.

Market analysts attribute the decline to expectations of minimal adjustments to oil output policies by the Organization of the Petroleum Exporting Countries (OPEC) and its allies, known collectively as OPEC+, until a full ministerial meeting scheduled for June.

In addition to concerns about excess supply, the market’s attention is also focused on the impending release of official government data on U.S. crude inventories, scheduled for Wednesday at 10:30 a.m. EDT (1430 GMT).

Analysts are keenly observing OPEC members for any signals of deviation from their production quotas, suggesting further volatility may lie ahead in the oil market.

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Energy

Nigeria Targets $5bn Investments in Oil and Gas Sector, Says Government

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Crude Oil - Investors King

Nigeria is setting its sights on attracting $5 billion worth of investments in its oil and gas sector, according to statements made by government officials during an oil and gas sector retreat in Abuja.

During the retreat organized by the Federal Ministry of Petroleum Resources, Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, explained the importance of ramping up crude oil production and creating an environment conducive to attracting investments.

He highlighted the need to work closely with agencies like the Nigerian National Petroleum Company Limited (NNPCL) to achieve these goals.

Lokpobiri acknowledged the challenges posed by issues such as insecurity and pipeline vandalism but expressed confidence in the government’s ability to tackle them effectively.

He stressed the necessity of a globally competitive regulatory framework to encourage investment in the sector.

The minister’s remarks were echoed by Mele Kyari, the Group Chief Executive Officer of NNPCL, who spoke at the 2024 Strategic Women in Energy, Oil, and Gas Leadership Summit.

Kyari stressed the critical role of energy in driving economic growth and development and explained that Nigeria still faces challenges in providing stable electricity to its citizens.

Kyari outlined NNPCL’s vision for the future, which includes increasing crude oil production, expanding refining capacity, and growing the company’s retail network.

He highlighted the importance of leveraging Nigeria’s vast gas resources and optimizing dividend payouts to shareholders.

Overall, the government’s commitment to attracting $5 billion in investments reflects its determination to revitalize the oil and gas sector and drive economic growth in Nigeria.

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Commodities

Palm Oil Rebounds on Upbeat Malaysian Exports Amid Indonesian Supply Concerns

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Palm Oil - Investors King

Palm oil prices rebounded from a two-day decline on reports that Malaysian exports will be robust this month despite concerns over potential supply disruptions from Indonesia, the world’s largest palm oil exporter.

The market saw a significant surge as Malaysian export figures for the current month painted a promising picture.

Senior trader David Ng from IcebergX Sdn. in Kuala Lumpur attributed the morning’s gains to Malaysia’s strong export performance, with shipments climbing by a notable 14% during March 1-25 compared to the previous month.

Increased demand from key regions like Africa, India, and the Middle East contributed to this impressive growth, as reported by Intertek Testing Services.

However, amidst this positivity, investors are closely monitoring developments in Indonesia. The Indonesian government’s contemplation of revising its domestic market obligation policy, potentially linking it to production rather than exports, has stirred market concerns.

Edy Priyono, a deputy at the presidential staff office in Jakarta, indicated that this proposed shift aims to mitigate vulnerability to fluctuations in export demand.

Yet, it could potentially constrain supply availability from Indonesia in the future to stabilize domestic prices.

This uncertainty surrounding Indonesian policies has added a layer of complexity to palm oil market dynamics, prompting investors to react cautiously despite Malaysia’s promising export performance.

The prospect of Indonesian supply disruptions underscores the delicacy of global palm oil supply chains and their susceptibility to geopolitical and regulatory factors.

As the market navigates these developments, stakeholders remain attentive to both export data from Malaysia and policy shifts in Indonesia, recognizing their significant impact on palm oil prices and market stability.

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