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Wema Bank opens new branches

By on June 30, 2015

Wema Bank Plc has  opened  two new branches in Lagos. The bank said the move was part of efforts to take business opportunities to the door steps of customers and achieve part of the planned growth for the 2015 financial year.
The new branches are Opebi branch and Oniru branch located at Ikeja and Lekki respectively.

“This development is underpinned by its aggressive business expansion strategy, which will increase its market share and deepen market penetration.

“The new branches have the full bouquet of the bank’s products which are tailor-made to meet the peculiar needs of its various customers, varying from corporate to retail products. Customers can also walk in to inquire about the bank’s electronic banking solutions,” a statement from the bank explained.

Wema Bank, now in its 70th year has continued to improve on its operations through innovative, customer-based products and superior world-class technology geared at delivering a delightful customer experience, it added.

Meanwhile, Fitch Ratings has published Wema Bank Plc’s long-term Issuer Default Rating (IDR) of ‘B-‘ with a Stable Outlook, Short-Term IDR of ‘B’ and Viability Rating (VR) of ‘b-‘. Fitch also published Wema’s long-term and short-term National Ratings of ‘BBB-(nga)’ and ‘F3(nga)’, respectively.

According to the agency, Wema’s IDRs and VR reflected the bank’s intrinsic characteristics, including the bank’s improving performance, noting that its earnings capacity was still limited.

“The bank is still recovering from large historical losses, resulting in its recapitalisation in 2013. The bank has since returned to profitability, but internal capital generation remains weak, providing limited capital buffers with which to absorb losses,” it stated.

The rating agency also considered Wema’s modest Fitch Core Capital (FCC) ratio relative to its peers, which it stated provided limited buffers against moderate internal or external shocks, particularly given the increasingly challenging economic conditions and market volatility in Nigeria.

“The FCC ratio improved significantly under Basel II due to the use of credit risk mitigation to reduce risk-weighted assets.”

Wema was recapitalised by N40 billion in 2013 in order to meet regulatory requirements. The bank plans to raise tier-2 qualifying junior debt to fund growth and strengthen regulatory capital ratios. However, this will not benefit its FCC ratio and lending growth is likely to put pressure on core capital ratios, Fitch added.

“Wema’s IDRs also reflect the highly challenging and volatile operating environment in Nigeria. The recent oil price shock and subsequent currency pressure has weakened the Nigerian operating environment and is likely to result in lower GDP growth in 2015.”

 

[ThisDay]