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Why we bought Mainstreet Bank – Skye Bank GMD

By on June 9, 2015

The Group Managing Director, Skye Bank Plc, Mr. Timothy Oguntayo, said the lender bought Mainstreet Bank Limited to tap opportunities in retail banking across the country.

Oguntayo, who stated this at a pre-Annual General Meeting press conference in Lagos, said the bank had completed the integration of its operation with Mainstreet Bank by 50 per cent.

He said, “The strategic intent of the acquisition of Mainstreet business is firstly for economies of scale. Firstly, there are locations Mainstreet is present which we are not, especially the South-East and some other areas.

“Therefore, having presence in some of those areas will help us to tap from the opportunities there. And most of those areas are actually retail banking related areas; this will help us in to mobilise low-cost deposits.

“For the customer base, the addition of the two entities will give us a total of four million customers and most of these customers are coming with deposits that have been stable over a period of time and this will be adding value to Skye Bank.”

According to the GMD, Mainstreet is also a big player in terms of lending to agricultural sector and it will be better for Skye Bank to harness and reap from the opportunities in the agricultural sector.

This, he said, would result to increased revenue for the bank.

In order to have a seamless integration with Mainstreet Bank, Oguntayo said Skye Bank had developed a roadmap on things it needed to do.

On whether the integration will lead to the rationilisation of branches, the Skye Bank boss said, “We have just taken over Mainstreet Bank and we don’t want to be in a haste to rationalise branches.

“But there are some that are obvious. For instance, if we are located on this side of the road and Mainstreet Bank is also on same side of the road. Unless the two branches can justify their existence, it will be a waste of money running two branches and two operating expenses. You know in Nigeria every bank has two generators. So, those are costs that we would avoid.

 

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