Chairman's Statement
Fellow shareholders, distinguished ladies and gentlemen.
It is indeed a privilege to welcome you all to the 9th Annual General Meeting of our great Bank, Ekondo Microfinance Bank Ltd and to present to you the Annual Report and Statement of Accounts for the year ended 31 March 2007. The occasion is quite significant in that it also presents an opportunity for us to look back at a year in which your Bank turned the corner into its first decade as an accepted provider of choice banking services to our people. A year in which Ekondo Bank joined an elite league of pioneers in Nigerian Microfinance Banking sector as the first existing community bank in Nigeria to be issued by the Central Bank of Nigeria to operate as a Microfinance Bank.
INDUSTRY REVIEW
The Federal Government continued to pursue its commitment to implementing economic reforms through prudent fiscal management in order to accelerate economic growth, reduce poverty and meet other key economic objectives as set out in its Microfinance Policy. The general price level has consistently been on the downward trend since September 2006 when inflation stood at 10.7%.
Better management of fiscal and monetary measures, stability in the prices of petroleum products in the local market, the relative decrease in the prices of food items and the favorable exchange rates of the naira against other major currencies, contributed to the attainment of single digit inflation figure of 8.5% in the review period.
Significant improvements were also recorded in Gross Domestic Product, per capita and interest rates. In its continued efforts to reduce the cost of doing business in Nigeria, Government has also continued the process to reform the power sector for improved electricity generation and supply. With the conclusion of the first stage of the reforms in the financial sector in 2006, confidence in the sector has been overwhelming and liquidity has improved significantly.
OUR BUSINESS ENVIRONMENT
The Microfinance sub-sector is just evolving and the benefits of that economic reform are yet to cascade down to the entirety of the niche market and the society as a whole as purchasing power of the majority of the citizenry is still a key issue. The need for providing financial services to small and medium enterprises has come into sharp focus with Government encouraging programs that will alleviate poverty.
The year under review was quite an eventful one in the microfinance sub sector as operators jostles for Microfinance operating licenses. With a heightened level of business development strategies by the newly consolidated banks, our customers have gotten more demanding as their expectation changed with the new marketing trend. Our focus has been to strengthen our leadership in the microfinance sub sector through the provision of quality service at a competitive pricing.
OPERATING RESULTS
In spite of the above industry situation, strategies put in place by the Board and Management had ensured that eh performance of your bank during the year in review is very impressive and has yielded considerable successes over the bank’s performance for the last financial year.
The bank’s Total Assets recorded an impressive growth of 74% from N344 Million in 2006 to N601 Million as at the close of 2007 financial year. Public confidence in the Ekondo bank grew over the year as is indicated by a 122% increase in the bank’s Deposit Liability, from 148 Million in 2006 to 330 Million in 2007. This positive trend also pushed quality loans booked by the bank from N169 Million in 2006 to N310 Million in 2007, an increase of 83%. The Bank’s earning capacity increased by 55% from N67 Million in 2006 tN104 Million in 2007.
With the above performance, the bank recorded a profit after tax (PAT) of N42, 488,061 in 2007 as against N29, 943,734 in 2006, a percentage increase of 40%. Management is fully involved in emerging developments in the Microfinance environment and its market and is well positioned to take full advantage of any opportunities nationally and internationally.
Management has not doubt that this new vista holds promises which we must work to the bank’s advantage in order to ensure that the future growth trend of our bank results in increased value for all stakeholders.
DIVIDEND
Ekondo Bank’s rate of profitability is arguably the best in the industry. We have consistently sustained one of the best Returns on Investments over the years. This year, we propose a dividend of 15 kobo per share to be paid to shareholders.
THE FUTURE
The Microfinance sub-sector is witnessing rapid and structural changes with varied challenges. Besides the high cost of doing business in the country there is the competitive disadvantage posed by statutory regulations to the industry by the Apex bank. We project that the ongoing unrest in the Niger Delta region will continue to constrain oil production in 2007 thereby pushing down overall GDP growth. Nigeria being highly dependent on the global economy is vulnerable to shocks generated by the global economic system. However, overall we envisage a vibrant business environment in the ensuing year.
Our strategy remains focused on growth driven by the strength of our products. In April this year, we introduced five products, namely: Ekondo Shares Acquisition Scheme (ESAS), Ekondo Rainbow Savings (ERS), Ekondo Shares Acquisition Fund (ESAF), Ekondo Target Savings (ETAS), Ekondo Asset Acquisition Scheme (EKAAS), to market and it is our hope that these launches will place us at a strategic advantage in our target market. We have also made bold investments in human capital as a strategy to checkmate emerging challenges and consolidate on our gains.
Our objective is to remain the market leader of the Microfinance business in Nigeria. The promises in the emerging sector is limitless and we hope to continue to blaze the trail of banking awareness for our people, provide employment and provide more decades of quality banking services to our esteemed customers.
CONCLUSION
The Ekondo brand has really done all of us proud in the market place and we have a lot to celebrate.
Distinguished shareholders, ladies and gentlemen, please permit me here to say a big thank you to our valued customers, who are at the hear of our franchise, for their invaluable support and patronage at all times. To my colleagues at the Board I say thank you for your invaluable contributions and support and to the Management Team; I say please keep up the good work.
To God Almighty who distributes blessings as He wishes, we give Thanks for blessing our collective efforts abundantly.
Fellow shareholders, distinguished ladies and gentlemen, I thank you for your attention.
Chief (Dr) Asuquo Ekpenyong FCIB, OON
Chairman
Back to top