• As MTN sacks 200 workers, 80 contract staff members
• NB, shareholders clash over N21bn dividend

The Bank of Industry (BoI) recorded an operating ‘profit before tax’ of N17 billion in 2016, grossing a 44 per cent increase, over the 2015 performance figure of N11.9 billion.

The BoI also said Waheed Olagunju led management truly strengthened Its loans and advances portfolio, surging it by 10 per cent, as it rose the N156 billion of 2015, to a whooping N171 billion in 2016.

The bank indicated on Monday in Lagos  that it’s disbursements to Small and Medium Enterprises equally increased by 42 per cent, shooting upwards to N8 billion, from N5.64 billion in 2015; just as the quality of its risk assets improved phenomenally, with a reduction in the ratio of non-performing loans to 3.72 per cent in 2016 from 5.87 per cent in 2015.

Consequently, the bank’s management has assured its stakeholders of a brighter and a more positive financial year in 2017, highlighting that its financial operations in first quarter of 2017 showed that the bank has performed brilliantly and profitably when compared to the first quarter in 2016.

The Acting Managing Director of the bank, Mr Waheed Olagunju who attributed the growth to strong commitment, professionalism and strict adherence to global best practices, also
posited that the achievements culminated in BOI’s consistent high ratings by international and domestic rating agencies.

“We are delighted that the country and the various constituencies we serve continue to appreciate the bank’s contributions to development in Nigeria which is also coming from such a prestigious and reputable professional body ICAN).

“This will have a very positive effect on us as we are going to be challenged to do more for the development of Nigeria,” he said,  describing the 2016 year as the best in the bank’s history despite last year’s economic headwinds.

Olagunju said that Moody’s assigned BoI Aa1 in 2016 up from Ba3 of 2015, while Agusto’s rating of AA- in 2016 was higher than A+ of 2015.

AA+, assigned by Fitch in 2015, was affirmed in 2016.

Olagunju said that in acknowledgment of the bank’s feat, the Institute of Chartered Accountants of Nigeria (ICAN) at its yearly dinner and awards, conferred a merit award on BoI for its outstanding contributions to national development.

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Olagunju assured that the bank will continue in its dynamic form, delivering with commitment on its mandate, as it will doggedly mobilise for strong, financial resources from the public and the private sectors, both on the domestic and international fronts.

In the meantime, South African telecoms giant, MTN, has sacked 280 of its workers in its Nigeria arm, in a major job cut that is targeting at least, 25 per cent of its 1,8000 workers in the country, a company source confirmed yesterday in Lagos.

According to the source, some 200 permanent employees and about 80 contract staffers across various cadres, ranging from new graduates to senior managers, were affected in a move the source said is designed to inject fresh blood into the telco’s workforce.

Many of those sacked spent up to 15 years with the company having joined MTN as it opened its business in Nigeria in 2001.

Sources said affected workers were given a dismal severance of 75 per cent of their gross monthly income multiplied by the number of years with the company.

“Given that the company is about 16 years old in Nigeria, the severance package brought pain and discontent among the affected staff.

“With the payoff structure, senior managers with 15 years of service were left with about N15 million; most of the staff got less than N5 million,” company source explained.

MTN Nigeria recorded nearly $1 billion in profit in 2016. However, the telecoms firm was heavily fined by the Nigerian government for failing to disconnect 5.2 million unregistered subscribers.

MTN’s spokesman, Funso Aina, could not be reached for comments yesterday.

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But a source familiar with the latest downsizing said 200 of those affected had earlier agreed to leave the company voluntarily.

The source said the sackings were as a result of “the changing dynamics of the telecoms industry in recent times”.

The source said the company introduced the voluntary severance scheme (VSS), to provide a window for one week in April, for persons who have served in MTN for five years and above to take up.

Those who decided to leave under the VSS were to be paid the equivalent of their three weeks gross salary for every year they worked with MTN.

“What it means is that if one worked in MTN for five years, one would be paid three weeks of their gross salaries times five,” the source said.

Eventually, all 280 staff were disengaged under the VSS and paid their benefits, the source said.

The source added that since revenue from the voice segment of the industry has attained its plateau, the new revenue stream would naturally come from data services. “Younger and tech-savvy Nigerian graduates are going to drive this new initiative designed to take the telco to the next level,” another source familiar with the development added.

In another development, shareholders of Nigerian Breweries Plc, NB, and the Board of Directors are on a collision path over the plan by the company to convert the N21 billion cash dividend earlier proposed by the directors to ordinary shares.

A cross section of shareholders, who spoke to Vanguard said they have resolved to vote against the motion when it comes up for approval at the Annual General Meeting, AGM, tomorrow. According to them, the case has been reported to the Securities and Exchange Commission, SEC and the Nigerian Stock Exchange, NSE, for intervention.

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Vanguard investigations show that the directors would still push the proposal successfully given their majority stake in the event the face off leads to a pool. It is not yet clear if the regulatory authorities are stepping in to douse the tension. The NB’s Board of Directors had proposed N20.5 billion as final dividend, amounting to cash dividend of N2.58 per share, for the year ended December 2016. But the company later said it will seek shareholders approval at the AGM tomorrow to convert the cash dividend to scrip issue.

According to the company, the conversion will help it to consolidate on its balance sheet. But speaking exclusively to Vanguard, the shareholders insisted that dividend payment is their right and must be paid once it is declared. Sir Sunny Nwosu, former National Coordinator, Independent Shareholders Association of Nigeria, ISAN, opined that the move is a ploy by the directors to increase their stake in the company as a first step towards eventual exit from the Exchange.

“We are totally against it because it is taking undue advantage of Nigerians. We are all aware that we are in recession and everybody needs every kobo; the directors do not need the dividend and, therefore, they want to use the scrip issue to increase their holding in the company. Whether it is one per cent or 001 per cent that the scrip issue will add to us as shareholders, it is not desirable to us.

“What they are saying is that they could not transfer their dividend. But they have been transferring their dividend for 70 years, so, why don’t they bear with us at this time of difficulty. It would have been better if they had not declared the dividend and allow the interim dividend to remain as the final dividend than declaring dividend and at the same time complaining that they want to plough back the money. It then means that the dividend declared can be classified as fake dividend,” Nwosu added.

Heric Akinduro, Chairman, Ibadan Zone Shareholders Association, said shareholders should be allowed to make a choice between converting their dividend to ordinary shares or going home with their dividend.

“For those that have excess money, they can increase their holding, but for those that do not have, they should give them cash,” he said. Agreeing with others, Patrick Ajudua, National Chairman, New Dimension Shareholders Association, NDSA, said: “We are totally against it. Once a company has declared dividend, it should keep to it. We are after our dividend because most of us have reduction in our purchasing power and the cash dividend will enhance our financial position and enable us to meet our obligations. This plan is not the best for us and that is why we are against it.”

Additional report from Nation and Vanguard