From the time it emerged that a little known Heritage Bank with less than 15 branches aptly coined ‘Experience Centres’ had won the bid to the Enterprise Bank acquisition auction, with more experienced players in the industry such as Diamond, Fidelity, Access and Skye Banks jostling for the same prize, industry watchers had to sit up and pay attention to this ‘little’ horse who not only had the guts to challenge these big horses to a race but also succeeded in beating them on their own tracks. This industry changing acquisition took Heritage from a regional bank with just 13 branches pre-integration to one with a total of about 200 branches, 57 cash centres, more than 177 ATMs and over 2000 POS terminals spread across major markets and commercial centers in Nigeria.
While this opening paragraph stands as a true mark of genius by Heritage Bank and an era defining moment for both the Bank and the industry in Nigeria – it is not the accurate account of the begining for a bank whose knack for innovation has it growing in leaps and bounds as the clock ticks into the future.
The story of Heritage Bank’s emergence cannot be told without mentioning the capital review instruction to the banking industry by the Central Bank of Nigeria (CBN) in 2006/2007. The inability of the Societe Generale Bank of Nigeria (SGBN), a bank who were already having some clearing problems of their own, to meet up with this capitalisation instruction by the CBN led to its demise and inadvertently provided a platform on which Heritage Bank would emerge some six years down the line when the International Energy Insurance (IEI) Plc team led by its Group Managing Director, Mr Ifiesimama M.P Sekibo, came in as a core investor. The team made a bid to recapitalize the now defunt SGBN and won the bid, setting up negotiations with the former legacy investor of SGBN and drawing up an agreement that allowed it to recapitalize the bank to the tune of N12 billion, taking up all liabilities and assets of the bank and finding some form of accommodation for depositors whose monies had been trapped for 10 years.
So while SGBN brought despair and pain to the hearts of its account holders after CBN closed it down as their accounts were frozen, Heritage Bank who inherited the license and structure of SGBN as a result of the aforementioned agreement emerged from the ashes of SGBN to bring smiles and hope to these same account holders by returning 100% of account holders money which had been frozen and inspired confidence in many to open new accounts with the bank.
The process used in returning account holders monies was done in a simple, hassle free and technology driven manner so as to cause minimal discomfort to the customers. It was carried out in two parts; account verification and instant issuance of payment checks, where four banks were hired to accommodate the large number of projected customers who would possibly want a payout. This would prove to be an unnecessary venture as most customers, surprised and impressed by the gesture of the ‘new’ bank opted to pitch their tents with them, leading to a 95% retention of SGBN customers.
This is a simplified summary of how Heritage Bank through genius was birthed, and started off its operations as a regional bank on the 14th of March, 2013.
Heritage Bank in commencing operations (as a regional bank), built its brand architecture around its unique philosophy to Create, Preserve and Transfer Wealth to its Customers, with its core values as quality service, integrity, excellence, innovation, performance, respect and tenacity. This philosophy of wealth transfer informs the bank’s concept of generation or legacy banking and also reflects in the intentional manner in which policies and decisions are made and executed to the minutest detail.
This intentional thinking is displayed in the naming of the bank’s strategic divisions after African wealth symbols in; Coral, Ivory, Manila and Cowry banking divisions, while it is also expressed in the apt coinage of the bank’s inaugural branches as ‘ Experience Centres’. Each instance highlighting the objective of the bank which is centred around wealth creation for the Customer.
In an interview with the Vanguard newspapers on the 1st of April 2013, a month after commencing operations, the MD/CEO of Heritage Bank, Mr Ifie Sekibo spelt out the vision of the bank as ‘… a bank that people will believe and know that generation banking is the way to go’ and named the objective of the bank as to become ‘… the best knowledge driven organisation technologically. And above all, being able to show the customer that in truth, service is what will make it possible.’ He also went as far as to say, ‘We don’t say we know what the customer wants, we can’t claim we can serve what we think is best for him, rather we would like the customer to to tell us what he or she wants us to do for him or her. We would serve the customer better when they tell us what they want.’
Fourteen days after its MD/CEO spoke those words in that interview, and in the thrust of its brand architecture, Heritage Bank rolled out a Zero CoT policy which was aimed at eliminating all forms of hidden charges in transactions thus tranferring wealth to its customers. This decision immediately enhanced customers trust, boosted the bank’s goodwill and increased deposit base.
Giant Genius Strides
Heritage Bank’s drive for unique customer satisfaction means that it always seeks out innovative ways to put a smile on the faces of its customers and one of these ways is in its Micro Small and Medium Enterprises (MSME) clinic set up in 2014 as a support platform to offer a holistic bailout strategy for SMEs in the country through a combination of services that include business diagnostics, financial literacy and entrepreneurship development, advisory services, customized product development for each customer and market knowledge development.
This scheme is backed up by the Heritage Investment Protection Fund; a non collaterized funding option that has an embedded insurance for the default risk inherent in SME schemes. This scheme has had groundbreaking partnerships that has assisted in the growth and rejuvenation of the SME sector as is testament to its collaborative works with HipTV on the Headies, Alibaba’s January 1st Comedy Show and Dbanj’s KOKO AGROPRENEUR campaign which was being championed by none other than the Minister of agriculture at the time, Dr Akinwunmi Adesina.
The bank it is, that also introduced Nigeria’s first pioneer portable POS solution self styled ‘PortaPos’, which accepts all EMV chip and PIN cards, MasterCard, Verve and Visa Cards. It is built as a regular mobile phone with bluetooth capacity that enables syncing with phones and printers while possessing a long lasting battery life, and is given to all of the bank’s customers for free. This trendsetting technology apart from complementing the bank’s drive for supporting SMEs, is an innovative way to ensure that the bank’s reach goes beyond the physical structure of branches and resonates with the words of the MD/CEO Mr Ifie Sekibo in the same quoted interview with the Vanguard Newspapers on the 1st of April, 2013 where he said, ‘…although having many branches is not the ultimate because we are going to use technology to drive our business. There is mobile money, Automated Teller machine (ATM), all driven by technology. We will deploy technology as point of presence matters a lot. We would show point of presence rather than building many branches.’
However, using technology as is the case with PortaPos was not the only means of innovation deployed by the bank as can be seen from the very inventive ‘The Corner Shop’, an initiative targeted at easing banking operations in the market place. The Corner Shop was first launched at the Gbagada plank market in Gbagada Estate and its objective as was with the Zero CoT policy plus all other policies of the bank was to drive up Customer satisfaction by making it easier for small business owners in particular market locations to basic banking operations around ‘the Corner’ while saving them the currency of both time and money. This was very well received by the Gbagada market traders and has since turned out to be a very succesful initiative by the bank .
While the above mentioned innovations, the MSME clinic, the PortaPos and The Corner Shop caused more than just some small ripples in the ocean of the banking industry for 2014 and would have been more than enough achievement in one operational year for any other bank, the real splash in the ocean came in the last quarter of the year when the Assets Management Corporation of Nigeria (AMCON) announced the Heritage Banking Company Investment Services Limited (HISL), a special purpose vehicle sponsored by the Heritage Bank, as the winner of the bid for the acquisition of Enterprise Bank. Equally impressive of the win was the swift payment of the N65 billion price tag for the acquisition within the specified timeframe by the issuing body and all of this was done in the face of stiff competition from more established industry players in the likes of Diamond, Fidelity and Skye Banks.
This acquisition immediately transformed Heritage Bank from a Regional Bank with just 13 branches pre-integration to a National Bank with a total of about 200 branches, 57 cash centres, more than 177 ATMs and over 2000 POS terminals spread across major markets and commercial centers in Nigeria, an impressive statistic that transitioned the bank from a 2nd tier bank to a 1st tier bank. The spirit behind the acquisition and the expectations of the same could not have been better expressed than in the words spoken by a Regional Director of the Bank South South, Mr Emeka Anene, who was representing the MD/CEO of the bank, Mr Ifie Sekibo, at the Heritage Bank sponsored Port-Harcourt Amateur Open Golf Championship. He said, ‘As 2015 unfolds, having secured all relevant regulatory approvals, we are pleased to announce the beginning of a seamless integration of both entities – Heritage Bank and Enterprise Bank – into a bigger and stronger financial institution that is oositioned to play a big role in the much envisaged transformation of the nation’s financial sector in line with the country’s stature as Africa’s largest economy. As an integrity driven business, we remain firmly committed to our continuous quest for quintessential banking services delivery by harnessing the best of the two worlds combined in terms of our innovative products, bespoke technology and expanded network manned by a team of tenacious people. We affirm our commitment to all stakeholders that we will continue to deliver on our promise of creating, preserving and transferring wealth across generations through highly personalized sevices’.
If the above cannot be defined as genius, it becomes a wonder what can be defined as genius as every move by the bank has kept industry watchers in wonderment, gaping aloud and asking questions like, ‘how are these people doing it?’ especially when such innovative ideas and moves are backed up with stats of a customer size increase of close to 200%, making it the fastest growing bank in Africa, while the audited financial statement for the operational year of 2015 (which is the bank first fulll operating year after the acquisition) shows that the bank attracted N312 billion naira as deposits from new and old customers during the year in review, supported businesses and individuals with loans and advances to the tune of N175 billion naira, achieving a total asset of N483.4 billion naira for the year, recording a gross earning of N24.2 billion naira, making a profit before tax of N1.5 billion naira, a profit after tax of N1.1 billion naira and a net interest income of N12.2 billion naira.
The ‘Midas’ Team
The strides as achieved by Heritage Bank in the few years of its existence (of which only a few has been outlined above) would not have been possible without some bit of ‘magic’ and in truth a band of ‘magicians’.
Mr Ifiesimama M.P Sekibo
Mr Sekibo is a tenacious entrepreneur, passionate game changer and result oriented professional with a proven track record in turn-around management, and this is not to lift verbatim, words as found on the Heritage Bank’s website, but to agree with the accurate description of a man who from turning around the fortunes of RIMS merchant bank in just 6 months, led a team which acquired Global Assurance Company Limited in 2003 from under the technical management of the National Insurance Commission to create the International Energy Insurance company (IEI).
Mr Sekibo recalling the experience of the acquisition in an interview described the opportunity to buy up Global Assurance as ‘…a big opportunity, I said to my people that with N15 million to buy 70 percent stake, it was very cheap. How can such a big business with such a big stake be this cheap but people are not seeing the opportunity?’.
The above statement was supposedly made at a time when there were no known energy insurance companies in the country and making such a move would have been considered very risky and bordering on stupid, but being the man that he is, Mr Sekibo took on the challenge and within five years restructured, repositioned and transformed a company whose office building had no windows and doors, and needed the assistance of Linkage Assurance and Trade Bank to afford leases of structures and equipments, and payments of staff respectively, into a company where he became the Group MD overseeing four (4) MDs of different divisions (IEI Insurance, IEI Assets, IEI Pension and PMC mortgage bank). And in his his words, ‘People thought it won’t be possible. We took engineers and taught them insurance and grew that market size.’
It was a case of deja vu again in 2009 when Mr Sekibo led another team of professionals to nurture the rebirth of the ersthwhile Societe Generale Bank which was transformed into an innovative Commercial Bank with Regional Authorization. This ‘new’ bank riding on the wings of innovation built a strategy framed around a unique philosophy of creating, preserving and transfer wealth for its customers. Mr Ifie Sekibo and his team called it generational banking.
He built this brand around trendsetting products, leveraging on the bank’s technological finesse, as the bank at the time was still operating with a regional authorisation and had less than 15 branches, aptly named ‘Experience Centers’ – but this status would change soon, as while industry watchers cheered one new product after another that the bank introduced into the market space, Mr Sekibo and his team masterminded a masterstroke by acquiring Enterprise Bank to form what is now known as the present day Heritage Bank. This was nothing short of coup.
Mr Ifie Sekibo is a well respected Alumnus of the prestigious Harvard Business School and a Fellow of a number of Professional institutes that includes, Institute of Directors, Chartered Institute of Bankers, London, Institute of Petroleum, Nigerian Institute of Management.
Mrs Mary Akpobome
Mrs Akpobome is the Executive Director, Service Bank, which takes responsibilty for all strategic support functions of the bank which includes; Information Technology, Customer Experience And Analytics, Business Services, Corporate Affairs, Corporate Services, General Asset Management and Program Management Groups. Simply put, Heritage Bank hangs on the shoulders of this pretty woman who was a key member of the team that acquired the defunct Societe Generale Bank of Nigeria and whose transformational competencies with over 24 years cognate experience in the industry was essential to the emergence of a Heritage Bank with Regional Authorization.
Mrs Akpobome as the Executive Director – Ivory Banking in this ‘new’ bank’ with regional authorisation oversaw Retail and Personal banking, E-banking, SME development and Private Wealth Management divisions. A responsibility in which she distinguished herself in, growing the stature of the bank as it made in roads into uncharted territories and rode into already charted territories with new strategies – one of which is the creation of the MSME clinic and the bank’s famed collaboration with the HEADIES in 2014.
In the last quarter of 2014, She was as part of the Heritage Bank team that pulled off the shock Enterprise Bank acquisition served as the Acting Managing Director of Enterprise Bank Limited, serving to stabilise operations and improve the service orientation of the bank in view of a seamless integration with Heritage Banking Company Limited to have what we now have as the present day Heritage Bank.
Mrs Mary Akpobome holds a bachelors degree from the University of Benin, an MBA from the University of Lagos and is an Alumnus of Lagos Business School, IMD (Switzerland), INSEAD (France) and a fellow of the Institute of Credit Administrators, Institute of Directors, and a member of the CIBN.
Mr Niyi Adeseun
Mr Adeseun is the Executive Director – Manilla Banking, overseeing Commercial and institutional banking divisions and has under his belt, over 23 years cognate experience in core banking operations.`This experience spans his days at the Standard Trust bank where he set up the Collections Products desk at its Head Office which metamorphosed into the Franchise Department before moving on to become the Group Head of 2 business offices of Skye Bank in Abuja, developing the bank’s business in Abuja and the North Central States.
In 2016, while receiving one of the bank’s numerous awards Mr Adeseun who represented the MD/CEO declared that the award is an affirmation of the bank’s committment to unique, technology-driven business model and focus on customer service, a strategy which he is a major driver of, as part of the team.
Mr Niyi Adeseun holds a B.Sc from OAU, an MBA from the University of Lagos and is an Alumnus of the Lagos Business School, INSEAD and the Manchester Business School.
Other members of the Team worthy of special mention include the delectable Mrs Adaeze Udensi, the Executive Director in charge of South Bank Directorate, Mr Ola Olabinjo, the Executive Director in charge of the Corporate Banking Division and Mr Jude Monye, Executive Director – Enterprise Risk Management and Chief Risk Officer.
This team of ‘magicians’ characterised by their charisma and excellence, have succeeded in building the Brand ‘Heritage Bank’ not by ‘cosmetic media perception moulding’ or razzmatazz but by effective consumer engagement, through technologically driven innovative products that is focused on customer service.
The team is ably ‘banded’ by Mr Akinsola Akinfemiwa OON, who sits as Chairman of the Board of Heritage Bank.
News media especially from the social media has recently been bedevilled with rumours that the bank is facing illiquidity, while the recent sack of 400 staff has been reported on several platforms as a seeming confirmation of that rumour. This has caused some bit of apprehension amongst customers but the effects of which has been greatly stemmed by the proactive action of the MD/CEO Mr Ifie Sekibo in his December 2016, ThisDay interview, where he clarified in no uncertain terms the liquidity status of the bank. In his words, ‘It is not true that we are illiquid, we have always been liquid. It is true that the whole indistry faced some form of liquidity challenge when we all moved monies into the Treasury Single Account. So a customer makes a request overnight for N2 billion or N3 billion, and you tell him to allow you pay him over two days, and they shout, thinking it is illiquidity. It is not! It has to do with management of your liquidity position.’
Mr Sekibo in clarifying the liquidity of the bank also threw some light on the bank’s decision to disengage with some of its staff, explaining that, ‘we made a business decision to acquire Enterprise bank and have not regretted that decision because we have been able to leverage on the 160 branch network of the defunct bank. I must however add here that although the acquisition remains one of our remarkable decisions, the challenge we have is with the people we inherited.’ He further explained that, ‘ when we acquired the bank, we ensured that we retained its workforce and integrated them into ours at a time we just had 11 branches. We said after a year, we would evaluate these staff and those who don’t identify and can’t fit into our overall vision would have to go. We have concluded that now and each time we want to implement this key business decision, we begin to experience a lot of negative press reports. This is more than just a coincidence.’
Mr Sekibo disclosed that ‘In that outflow period, N300 billion left our system and came back into our system, because people have realised that it is (the rumours) all false. First they said the next bank the Central Bank of Nigeria (CBN) would take over was going to be Heritage Bank. It is not true! The Central Bank cleared that issue.
These statements made in December 2016 has done a lot to prepare the customers for recent happenings as they’re are adequately informed of what’s happening in the bank and have their confidence boosted by the straightforward, truth speaking character of the MD/CEO, and like the MD/CEO stated in the interview, ‘we dare to say that since June that this negative press started and till today, that our doors have not closed for one day. Every customer that comes in, gets his money.’
The bank intends to keep building products along its philosophy to Create, Preserve and Transfer Wealth to its customers, aiming to utilise the immense value and opportunities in the Small and Medium Scale Enterprises (SMEs) where it has noticed a skill gap in the industry and like the MD/CEO opined, ‘most banks are not equipped to mentor this scale of business. Money is not the first thing to get business right; there are things that must be out in place first before money. So, we intend to work with SMEs and nurture them so that as they grow, we also grow with them. We would like to see the SMEs grow and become household names like Dangote, Femi Otedola.’
This vision drives the team of the bank and dictates the direction of the products being created as outlined by the MD/CEO in an answer to a question