Author: World Finance

Chesapeake Utilities: ‘We have an obligation’ to build sustainable energy future

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Chesapeake Utilities Corporation has been providing energy to the US east coast for over 160 years. But it is a modern, diverse company, with a clear commitment to the planet and to the people it serves, alongside its drive to develop profit for its shareholders. President and CEO Jeff Householder explains how the corporation is meeting the challenge to build an environmentally sustainable future: by reducing its own emissions, supporting suppliers and customers to reduce theirs, and innovating in the energy mix it provides. He also discusses the company’s corporate governance achievements – in particular how increasing board diversity has improved the conversation around Chesapeake Utilities’ strategy.

World Finance: Jeff, first can you introduce us to Chesapeake Utilities, and the scale of your operation?

Jeff Householder: Well we’re obviously a US corporation, traded publicly on the New York Stock Exchange. About $2bn, little bit more than $2bn in total assets and market capitalisation.

We serve around 300,000 customers over about nine states, with operations principally in gas transmission, distribution, some electric distribution. We’re probably the 15th or 16th largest propane company in the US at this point.

Our growth has been fairly phenomenal over the past 10-12 years; we’ve doubled the size of our company three times, over that period of time. We have a long, very strong track record of financial performance. We’ve seen returns above 11 percent for 17 years in a row. I think we’re on 60-plus years of paying consistent dividends. We typically are in the upper quartile of energy delivery companies in terms of just about every performance measure that you could think of.

World Finance: The energy industry is under more pressure than ever before to transform, and innovate, and enable an environmentally sustainable future: how is Chesapeake meeting that challenge?

Jeff Householder: Well I think first of all, we have accepted the fact that it is a challenge, that we have an obligation to perform. We are focused significantly on our internal emissions, doing everything from limiting vehicles, converting them from gasoline and diesel to other fuels.

We’re purchasing satellite time, looking for leaks in the system, and we’ve replaced literally hundreds of miles of pipeline and tightened up our systems significantly.

We’re also focused upstream on our suppliers, to make sure that we’re getting supplies from individuals that are also paying attention to their emissions. And we’re working with our customers to make sure that we can do everything we can to ensure that their emissions are reduced.

World Finance: Your stated mission is to “deliver energy that makes life better for people and the communities [you] serve” – what does that look like in practice?

Jeff Householder: Well I think that follows several different patterns. One is, everywhere we go with natural gas, we find that economic development improves. We bring jobs to the communities, it really is an amazing thing to see communities blossom when they get natural gas service for the first time.

I’ll give you an example, we recently expanded down into another area in southern Maryland that had not had natural gas service before. Converting oil, coal, much more significant emission fuels. And we’re seeing economic development in those areas flourish. I mean you’re beginning to see additional jobs come into those communities because of the expansions of industry and commercial development that’s occurring around the natural gas opportunity.

We also have a group of employees that are highly engaged and that are highly dedicated, not just to supporting customers, but to supporting the communities where we serve. And so we have high levels of charitable contributions, employee volunteerism. We really spend a fair amount of time in our company thinking about how we are providing services to customers, how we are supporting our communities. And what we need to do to make sure that our employees are engaged and able to participate in all of those things.

World Finance: Congratulations on winning the World Finance award for Best Corporate Governance in the US for 2022; what does this recognition mean to you?

Jeff Householder: Well I think it’s a testament to the great work that many people in our company have done over the last many, many years. This is not a recent occurrence for us; we take corporate governance very seriously, our board is taking it very seriously. We’ve seen increases for example over the last few years in the diversity of our board. And it really has changed the way that the board interacts, the way that the board thinks about issues. We’re seeing a much more robust conversation about where we need to go strategically, and it’s all because I think that we have more significant diversity on the board.

We’ve made a number of efforts to increase the transparency of our reporting. And we have a fundamental value in our company of integrity. And I think we try to live by that every day, and our governance actions and practices speak directly to that.

World Finance: Finally, what is your vision for a sustainable energy industry, and for Chesapeake Utilities?

Jeff Householder: I think there are several things; as I mentioned earlier, we have an internal obligation I think to make sure that our emissions are as low as we can possibly make them. I think beyond that there are a number of actions that our company is taking and can take.

We will see definitely a change in the chemical composition in the gas that we provide through our pipeline services. I think you’ll see much more renewable gas, we’re moving down a path to invest in those operations ourself. I think you’ll also see an opportunity to introduce hydrogen into our systems. We’re already starting to test that in some of our industrial facilities.

I think natural gas has a long runway ahead of it: to reduce coal, to reduce oil, to reduce other fuels that are much more impactful on the environment.

We also see significant opportunities both for our employees and for our customers to let us help them manage their emissions reductions. And so I think those are just a handful of the issues that really drive us forward, not only doing the right thing in the environment, but actually being able to do that and continue to satisfy our investors’ needs for earnings.

Hyper-personalisation: The future for intelligent digital banking

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Grupo Financiero Banorte has long been at the forefront of digital banking in Mexico; Chairman Carlos Hank Gonzalez explains the bank’s latest ‘1-2-3’ digitisation strategy, how it is delivering high value, banking-in-minutes functions for its customers, and how Banorte is able to move closer and closer to a hyper-personalisation mode of promotion and service delivery.

World Finance: Carlos, tell me about Banorte’s current digitisation strategy.

Carlos Hank Gonzalez: After successfully concluding our strategy for 2020, we defined a new vision named 123. This new vision aims to make Banorte the best doing banking in a digital world, and we are on track to achieve it.

This strategic plan focuses on hyper-personalisation. This means offering custom solutions to match each personal circumstance by expanding our digital capabilities while placing the customer at the front and centre of our digital transformation.

To meet this objective, we defined a strategy based on three pillars:

First, and the key piece: maintain the acceleration in Banorte’s digital transformation process. Continue pushing for a digital offer, operation and service for people and companies.

Second: to accelerate the transformation of our digital services for our customers, we established strategic alliances with partners such as Rappi – with more than 600,000 credit cards already delivered.

And third: to launch a new digital bank, and explore all potential opportunities.

World Finance: And what are the first applications of this 123 vision?

Carlos Hank Gonzalez: Banking in minutes. We’ve already delivered significant progress in that area: branches can open personal accounts in just 15 minutes, 100 percent digitally, incorporating high-value functions and security for the customer.
Among other advances, credit cards and mutual funds are available from the bank’s mobile app in a matter of minutes.

There’s also paperless processing of contracts through any of our channels and digital identity verification to make it easier, quicker and more secure for our customers to access our services.

We will continue working on four major technological bridges: the use of the cloud, artificial intelligence, data and biometrics identification. All targeting the creation of custom services for each person.

World Finance: How else is Banorte innovating?

Carlos Hank Gonzalez: We invest around 13 percent of our total income each year in transforming our bank to continuously improve our self-service channels and enhance our banking operations, as well as to leverage on data about our customers and the market to achieve hyper-personalisation.

Among many initiatives, Banorte’s analytics team has developed indicators that incorporate information from its branches, including valuable insights on each micro-market to support existing clients and attract new ones.

We have moved from a strategy of one-size-fits-all promotion to one increasingly close to hyper-personalisation.

Also, we operate through a collaborative scheme called cell-based working, in which multi-disciplinary teams are assigned a specific task, such as improving a process or developing a new product, accelerating the execution to create an improved customer experience.

Thanks to these and many other efforts we recently received a Google Cloud Financial Services Customer Award, honouring Banorte for innovative thinking, technical excellence and digital transformation.

World Finance: And what about customers who may prefer a more traditional approach?

Carlos Hank Gonzalez: At Banorte, we believe we have found the right balance. The goal is to seamlessly combine our branch-based services with our digital efforts. It ensures a flexible experience that works for all ¬– whether a customer prefers to bank in-person or on their smartphone.

Innovation is at the core of what we do, and that’s especially critical for the industry as a whole during these unprecedented times.

 

Nordkap pilots solution to SONIA interest uncertainty for UK real estate

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The UK has entered a period of real interest rate volatility in the last year, as the Bank of England struggles to contain the inflationary impact of the invasion of Ukraine, soaring energy prices, and the European cost of living crisis. And for treasury departments still using manual processes and spreadsheets to manage their debt, this has meant frequent changes to formulae and even more work checking for errors – hugely compounded by the Bank’s move from LIBOR to SONIA. But Swedish debt and risk management company Nordkap has a solution: its cloud-based automation software can automatically compound the daily SONIA rate and perform scenario analyses to project the total cost of debt. Head of International Sales Fredrik Eriksson explains how Nordkap can save treasury management departments time and effort, and the company’s plans to pilot its services in the UK before launching in mid-2023. You can also watch the first half of this interview with Fredrik Eriksson, where he explains just how much time and money Nordkap can save for commercial real estate treasury departments.

World Finance: I’m back with Fredrik Eriksson from Nordap, the commercial real estate treasury management specialists. Fredrik, here in in the UK we’ve entered a period of real interest rate volatility, for so many reasons; but compounding that challenge for commercial real estate companies is the Bank of England switching from LIBOR to SONIA?

Fredrik Eriksson: Yeah; going into 2022, we saw interest rates going up already back in the fall of last year. And no one could imagine that we would have a war, and the energy crisis, and coming out of the pandemic with the supply shocks. And the inflation that took off because of that has forced the Bank of England to increase rates multiple times.
But with the overlay and the transition from LIBOR to SONIA: commercial real estate companies are sitting in a position where they have to update manual spreadsheets multiple times a year, unless they have a system in place. And with the SONIA new calculation method, that’s not really an easy feat. It’s time consuming, and again it comes down to searching for errors.

World Finance: How does Nordkap’s treasury management system address this challenge?

Fredrik Eriksson: Well it’s a matter of having the calculation method for SONIA intact and in place, because a lot of the companies today struggle with setting up processes in how to calculate interest.

When we had LIBOR, you knew going in to the new period how much you’re going to pay by the end of that period. You can’t take that for granted anymore – in fact you find out five days before the payment due date how much you need to pay.

Within our sleeve of modules we have the ability to do a lot of scenario analysis and what we call budget reporting. Where we can do a lot of simulations with… we look at the forward curve of SONIA, for example, and together with that we can run scenarios and see how your interest rates cost will change depending on different scenarios.

It allows you to be more proactive and have a better understanding of where will I be by the end of the quarter?

World Finance: And of course you’re here in London as you prepare to bring your services to the UK; how does the market compare with back home, and how are you adapting your offering?

Well it’s a good question. I mean we’re looking at the UK market now, and we are initially scratching the service. We’re realising very quickly that it’s a very, very large market, and of course that’s the reason we’re going after it!

But what we’ve found though, even in the last couple of days looking at some of those competitors, they’re not really focused 100 percent on the commercial real estate market. They are more broad in their nature. They might not even be automated! We heard about a competitor yesterday, a fairly big one. You can enter your debt in their system, but you actually cannot get the interest updated in their system.

So we feel that where we are right now, we’re fairly nimble in that regard. So that allows us for example, going into this pilot programme, and we find out more about the intricacies and the special needs of some of the UK market needs, we can scale up within our development teams and bring in more people. And really help focusing on some of the features that are more required in the UK, compared to for example Sweden.

World Finance: Yes so you’re starting with this pilot programme – tell me more about that, and, do you have a timescale for your full launch in the UK?

Fredrik Eriksson: We have this three phase approach here. We will bring in three or four pilots, basically to validate that our calculation methods are correct. We’ve of course checked with BoE and so forth, but we want to make sure that the nuances between the different banks, that we get everything right.

So that’s the first phase with the pilot programme, and it allows companies to be part of helping us, and customising a system tailored to their specific companies. So they sort of create a wishlist of things that they would like to see us implement and develop over time.

So the pilot programme is estimated to run Q1 of next year, 2023. And then we have phase two, sort of the second quarter, where we will go into a sort of free trial and roll out a more complete solution to then hopefully having regular paying customers in the second half of next year.

World Finance: Fredrik, thank you very much.

Fredrik Eriksson: Thank you.

Automating treasury management for commercial real estate with Nordkap

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Nordkap is a Swedish treasury management company. Thanks to its exclusive dedication to the commercial real estate segment, the business has captured 80 percent of the market in its home country, and is now bringing its expertise to the UK. Fredrik Eriksson, Nordkap’s Head of International Sales, explains how the company’s cloud-based automation software can remove the friction of manual entry and error checking, giving treasury departments 15 percent savings in time alone, and growing alongside commercial real estate companies as their risk and debt management needs become more sophisticated. You can also watch the second half of this interview with Fredrik Eriksson, where he explains how Nordkap’s software can automatically compound the Bank of England’s new SONIA interest rate method.

World Finance: Fredrik, introduce us to Nordkap and the services you offer to your customers.

Fredrik Eriksson: We offer a risk and debt management system for the commercial real estate space. We started back in 2011, and what we see historically is that the people working in the functions of treasury work with a lot of manual entry – keeping track of what debt is maturing, when it’s maturing, and keeping track of all the cashflows that goes on within the debt structure of a portfolio.

What we do is, we automate that process. So interests are automatically updated, so they can easily access reports at their fingertips, with the click of a button. And therefore rather than spending their time entering manual data and searching their formulas for errors, they can focus their time proactively, in strategically managing risk and the business on an ongoing basis.

World Finance: I mentioned your incredible market-share; why do so many CRE companies choose Nordkap?

Fredrik Eriksson: They use us predominantly for a great customer service, they use us for the product support we have in the back. But also simplicity and the ease of use, and user-friendliness of our product.

It’s a SAAS solution, meaning it’s a system that you can log in, you can access the data and everybody has access to the same data. So it’s sort of syncing up in a way that makes it very, very easy. It’s a user-friendly system, it’s intuitive.

And when a CFO leaves, or a treasury manager or a finance director leaves, they usually go to a company that might not have Nordkap, and they bring it with them. So that allows us to broaden our spectrum that way as well. So it’s a lot of word of mouth, and it’s been really, really rewarding.

World Finance: So how much of an impact does working with Nordkap have on these companies?

Fredrik Eriksson: Well, we did some analysis a few years back with a consulting firm, just to kind of validate, you know, how do the companies work, and what is the impact to their business?

And we noticed they save actually around 30 percent in risk, just standalone, using our system. They save about 15 percent in just time savings going from a manual process into an automatic system. And in fact using one of our modules when it comes to swap transparency and so forth, they’ve been able to save roughly one percent in interest rate costs.

World Finance: Yeah, as you say, it is a modular system that you offer, how does this work for your customers?

Fredrik Eriksson: We want to make sure we have a system that works for the customer, that they don’t pay for a bunch of extra features that they don’t use.

We want to work with of course large companies, but we want to grow with the company as they start out in the business. It could be a spin-off, where you have maybe a company that only has three to five buildings; they might not have a very sophisticated need when it comes to the management of the debt, more than keeping track and getting the right reporting, and the right metrics of the portfolio. But over time as you grow and develop over the years, we can turn more and more features on for you, that are more sophisticated, and that they can use as they become larger.

So we can have clients for example that initially when they come in, they don’t have access to the capital market. They might not even use hedging. But over time, as they grow, they can start accessing the capital market, or maybe want to start hedging their portfolio in some ways, and that’s where we really can help.

How Baiduri’s mobile app helped overcome 2020’s unprecedented challenges

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World Finance recognised Baiduri Bank’s b.Digital Personal app as the best mobile banking app in Brunei for 2021. Wen Feng Goh, Baiduri’s Head of Digital Banking, explains how important the app was in Baiduri’s response to the pandemic, what it means to build with an ‘all-in-one’ design principle, and how customers’ increasingly digital-first behaviour is informing Baiduri Bank’s strategy.

World Finance: You launched b.Digital Personal in March 2020, just as the world began to lock down – how important was it in your response to the pandemic?

Wen Feng Goh: The response for us is extremely important. Because as you can imagine, when the pandemic hit it brought a lot of unprecedented opportunities as well as challenges for the market.

So when we launched b.Digital Personal on March 9th, coincidentally it was the same day that Brunei recorded the first case of COVID-19. So as you can imagine that brought on swift social distancing policies and crowd restriction policies in place.

So when we launched b.Digital Personal, that was instrumental in getting people on board, because with the new platform it offers self-registration. So traditionally, with the old system, what customers would have to do is visit a local branch to get signed up for the service. But with the new b.Digital Personal, customers could just on-board themselves through the app.

World Finance: What other important features did the app offer?

Wen Feng Goh: So I’ll just focus on three features that we’ve rolled out since then. One would be the display of foreign exchange rates – so, that is important for the customer to be informed of the rates they will be offered, particularly when they’re doing international transfers overseas.

The second part is the recertification of the PCI-DSS standard. So that is an industry-wide certification that masks credit card information being transmitted across digital channels.

And obviously the third being our most important I think, is our ability to accommodate customers’ requests. Because as you can appreciate during the pandemic, customers are apprehensive about approaching our branches. So we have to offer them a way to interact with us. And that would be done through the digital app where it’s authenticated, and we will be able to expedite resolutions of any issues or requests.

World Finance: You’ve said the app is designed as an ‘all in one platform’ – how are customers using it to not only manage their balance, but their entire financial lives?

Wen Feng Goh: Yeah, so, all in one is still a design principle that we continue to invest in for any upcoming features that we have. So apart from the traditional transaction features that we have on the app itself, we also have loan calculators, retirement savings calculators, as well as an investment calculator, which helps customers to be informed about their risk appetite when it comes to savings, as well as making the right investments, what sort of investments is appropriate for them. As well as what sort of, for example, taking out a loan, what kind of income, savings they need to have, to be able to reach that goal.

World Finance: And how secure is all of this functionality kept?

Wen Feng Goh: So as you can appreciate, in this day and age customer information, customer privacy is of the utmost importance to us. So we continue to invest heavily in encryption methodologies, as well as adopting industry-wide practices from PCI-DSS standards to the 128 bit encryption across end-to-end, to be able to fully secure all those transactions and customer information.

Additionally, on top of that, we also employ mobile device biometrics, as well as an introduction of an n-PIN, which is a unique PIN that customers would set themselves to verify and authenticate transactions through the app.

World Finance: Finally, how has the app changed the bank’s relationship with your customers, and helped advance the bank’s strategy?

Wen Feng Goh: So, with the introduction of b.Digital Personal in the middle of the pandemic, it has inevitably changed customer behaviour. So right now I would safely say that the digital channel is probably the first that the customer would approach, rather than the traditional branch.

The bank’s strategy has always been to move to a digital-ready channel, right? That is the future, and that is something that we continue to invest in. And obviously with the new normal, you would call it that way, that customers are interacting with our digital channels, that gives us more confidence to be able to say that we will continue to provide more features and services for our customers.

Zenith Bank commits ‘heart and soul’ to sustainable, responsible banking

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Zenith Bank has long been at the forefront of corporate governance in not only Nigeria, but the whole of Africa. Its group managing director, Ebenezer Onyeagwu, explains how the bank’s chairman and founder established the core values on which Zenith continues to thrive, the bank’s commitments to sustainability, and its corporate social responsibility projects. Watch the other parts of this interview in our Zenith Bank playlist.

World Finance: How do you ensure robust standards and practices today?

Ebenezer Onyeagwu: First is that I think I will give the credit to our chairman and founder. When he started the bank, he made sure that the core values on which the bank thrive were integrity, discipline, ethics, and professionalism. That forms the bedrock of our corporate governance practices.

Governance is so well entrenched in the system that it is part of our creed. And it’s part of why we are successful. So we have it entrenched throughout the system, from the board to the least person. And that’s why we continue to be successful, and we’ve continued to sustain it. And we will continue to sustain it.

World Finance: Zenith has committed to a number of the UN’s sustainable development goals; talk me through these, how has it changed the way Zenith operates?

Ebenezer Onyeagwu: We’ve subscribed to quite a number of them. The first is the principles of people, planet and profitability. Besides that we subscribe to United Nation Global Impact, United Nation Finance Empowerment that deals with the principles of sustainable banking. We subscribe to Nigeria sustainable banking principles, as well as women empowerment.

Now, how has that impacted our business? Maybe I’ll start with the women.

Today, in terms of the composition of our staff, there is gender balance in the system. My deputy is a lady. We have four banking subsidiaries: two are led by women. We also have a women finance programme, where we provide funding for women-owned businesses at subsidised rates, both long-term and working capital.

We also ensure that we bring in the sustainability consideration into our credit process. So all our projects we do in the bank are screened to ensure that there is compliance with the sustainability principles.

We have done six standalone sustainability reports over the years. So we believe in these principles, we commit our soul and heart to it. And in Africa we’ve won awards back to back as the most responsible corporate organisation.

World Finance: Clearly the prosperity of Nigeria is very very important to you; how is Zenith Bank giving back?

Ebenezer Onyeagwu: Yeah – when it comes to corporate social responsibility we are very emotional about it. Last year we spent two percent of our profit after tax, which came to about $10.8m on social investment.

We give to support security in different states of the country. In 2016 we spent about $600m to buy 10 cancer screening equipment we donated to an NGO. We also support female basketball league, grassroots football. We are also building ICT centres in modern universities across the country.

One that comes to mind is the sponsorship of Inside Africa – is a platform for African advocacy, where we are expounding the rich cultural heritage of Africa, the high energy, the resourcefulness of Africa. Zenith has sponsored that programme for the past 15 years, because aside from Inside Africa, you see that Africa doesn’t really have a voice. So we’re happy to be playing our role, and happy to project and market Africa to the world.

World Finance: Ebenezer, thank you so much.

Ebenezer Onyeagwu: Thank you.

Zenith Bank can ‘grow the next champions’ by mentoring Nigeria’s SMEs

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Nigeria’s economy remains hugely dependent on its oil and gas industry – but thanks to tailored and innovative support for SMEs from commercial banks like Zenith, the country is slowly diversifying and becoming more economically stable. Ebenezer Onyeagwu explains how Zenith Bank is helping young businesses and start-up entrepreneurs. Watch the other parts of this interview in our Zenith Bank playlist.

World Finance: Let’s go back to the sectors you were talking about that are up and coming; how is Zenith Bank supporting all of those industries?

Ebenezer Onyeagwu: The first thing we are doing to support the industries is that we are providing credit facility for all of them, by way of working capital, by way of term facilities. We are also helping most of them to access the various intervention programmes that have been put in place especially by central bank, that comes as long-term subsidised rate.

We are also innovating. SMEs, we are very particular about them, we see them as where we grow the next champions. We are looking forward to them one day being listed on the stock exchange. So we have a programme, we have the SME Grow My Business, we provide credit facility for them. We expose them to financial accounting and record keeping. We also provide mentorship for them.

Beyond that, in the tech space we started with a tech fair. The essence of that tech fair is to enable us to identify up and coming digital entrepreneurs through showcase. And at the end of the day the finalists, apart from providing cash award for them, we take them under our wings. And right now I think we have about 20 of them under our mentorship.

Then we also have some creative sector, CBM initiative programme, that provides credit facility, long term also at subsidised rates. We are giving them access to those facilities as well.

World Finance: And what about for companies that are just starting up? How is Zenith Bank investing in the future of young African entrepreneurship?

Ebenezer Onyeagwu: First we onboard you, we situate you and understand your business plan. You know, in some cases, some of them well… out of passion they have this very big, bogus ambition. But we are able to get them through a first plan that will enable them to scale.

Then we make sure that when it comes to funding, we sit with them, because most of them – yes, they have the business idea, but they have never borrowed before. So we take them through the rudiments of accessing facilities and doing it in such a controlled and coordinated manner that they don’t get their fingers burnt.

So we take them through, especially those who are in the fintech space, who don’t understand issues around compliance, around governance. We provide a model for them. And also help them in terms of training their team.

Nigeria’s young, active workforce ‘will continue to grow and create wealth’

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Nigeria’s economy bounced back from its COVID-19 slump with growth of 3.4 percent in 2021. Zenith Bank group managing director Ebenezer Onyeagwu joins World Finance to discuss the country’s economic health, the government’s latest development plan, and the many opportunities available in Nigeria for investors who understand the country’s long-term needs and potential. Watch the other parts of this interview in our Zenith Bank playlist:

World Finance: What’s your view on the country’s economic health?

Ebenezer Onyeagwu: I’m very optimistic about the economic health of Nigeria. That’s because Nigeria is a huge market. You have 200 million people, and 50 percent of that population, that demography, is below age 30.

You are talking about an active, consuming, valuable workforce – you can’t beat that! You can’t get that anywhere.

Now in terms of economic development, if you look at how we came out of recession, what comes to mind is the contribution of agric, ICT, services, fintechs. These are sectors that are thriving.

There are quite a number of entrepreneurs who are innovating and digitising every aspect of human engagement. So for me I am quite optimistic.

And again, the government has come up with a lot of reforms. The national economic development plan emphasises that the country requires close to $800bn for us to improve the infrastructure in the country in the next five years. That will be a difficult thing to achieve, because we will need for Nigeria to really realise its potential, we need FDIs to come in.

World Finance: How attractive is Nigeria to foreign direct investors? There’s a lot of risks that are associated with Nigeria – security risks especially with infrastructure – what’s your view on that?

Ebenezer Onyeagwu: Thank you Paul – in terms of security risk, there’s insecurity everywhere. Different regions of the globe have their own different security challenges. I can admit that! Yeah we have our own, but it’s being addressed.

If we invite the other challenges we see, they represent opportunities for investment. For instance, we don’t have – if we are looking at roads, we don’t have good roads. We don’t have a rail system which will facilitate human traffic and also movement of light goods here and there.

We also need investment in healthcare. The amount of outflow from Nigeria to other parts of the globe in terms of medical tourism is huge! But if we have investment in healthcare, we will be able to save a lot of foreign exchange for the country.

And, if you look at agric – Nigeria, if you fly across the country, you see good arable land, that, oh, we need to do forming that you are seeing is subsistence level! We need to mechanise it. We need investment. Nigeria can become the food basket, the home for organic food the world!

I can go on and on. But what you see is that massive investment will need to be put into the country, but whoever is coming should be long term. If you are not long term, I mean, if you take a short term horizon in Nigeria, you will not make money. In fact you will create volatilities for everybody, including yourself.

I mean how come in Nigeria, if you look at the return – Zenith Bank is just 32 years. It was started by Mr Ovia in 1990. We took the equivalent of $4m. But today we have shareholders fund of over £300bn. I mean, that’s coming from Nigeria! We continue to grow and create wealth.

There are quite a lot of incentives. The government has also come up with a new finance act that has made the tax regime a lot more effective for corporates.

If you are looking for the destination of the next intelligent properties or building you have, it has to be places like Nigeria, and Africa.

Maybe what we need to do is stronger advocacy, in order to create the awareness for people that the country is not as bad as it’s been perceived to be.

Zenith Bank GMD: 10 percent growth reflects ‘quality and calibre’ of team

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Nigeria’s Zenith Bank group reported growth of 10 percent in gross earnings and in profit before tax in 2021 – a remarkable achievement considering the ongoing economic impact of the pandemic. Group Managing Director Ebenezer Onyeagwu discusses the ways the bank is innovating and its post-pandemic strategy. Watch the other parts of this interview in our Zenith Bank playlist.

World Finance: Ebenezer, talk me through those numbers: how was this growth achieved?

Ebenezer Onyeagwu: Traditionally, Zenith has been over the years a performance-driven organisation. The figure you see typifies the real core fundamentals of the business. We are very dominant when it comes to the corporate business, and indeed retail side too!

When we started retail business three years ago, we had about only 3.4 million accounts. But today we have 10 million accounts. We had about three million cards, today we have about 14 million active cards, and it’s growing.

We are the bank with the largest shareholders’ fund – about ¢3.2bn – that gives us the deepest pockets to do whatever kind of deal there is available to be done in the country.

We also have a pool of talent, the best in class set of teams working for us. And we also have a board that is very well diversified – so that also provides effective challenges in the board deliberations.

So the result you see is just a reflection of the history of performance of the organisation, and also the kind of quality and calibre of team that we have.

World Finance: As you say, Zenith has customers from retail up to corporate – how are you innovating for each of those segments?

Ebenezer Onyeagwu: The way we are innovating is looking at the customer journey, and being able to understand the aspirations, and making sure that we develop the right products.

So the first thing we did was to create an omnichannel, so that we can integrate and engage customers at whatever segment. We have mobile banking, we have the POS, we have ATM, we have the internet banking. So the kind of platform we have gives us that delivery to connect with customers at every segment of the market.

We are also able to integrate and connect with any business that has the artificial programme interface. So we are building products and services to really align with the demands of the market.

At the corporate end of the business, we are able to innovate – if you are a corporate customer with Zenith, you can receive your money from whatever part of the country where you are. Then you can also make your payment from wherever.

We are also refining and promoting digital literacy and awareness, that is helping people to really embrace the use of digital technology in business. In fact we see ourselves as a technology company with a banking licence. Just because of the disposition we have towards technology applications.

World Finance: Now, what is the strategy for Zenith Bank group as the world finds a post-pandemic new normal?

Ebenezer Onyeagwu: Post-pandemic, a lot more transactions will be done electronically. Therefore what we have decided to do is, beyond the omnichannel that we use in engaging customers, we are looking at building a super app that is integrative. We will be looking at things like expanding our digital footprint. We also will be rethinking and remodelling our business services and products to ensure that they align with the aspiration of the new normal.

The board recently approved us to invest over $100m in building new enterprise architecture, and also building new applications that will give us that position and dominance that will secure a privileged position to take advantage of the opportunity.

Above all, we need to be assertive in the market with the digital application, and occupy that position of right of play in whatever segment.

Baiduri Bank commits to sustainable banking and ‘co-creating the future’

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Along with its fresh rebrand and new environmentally sustainable headquarters, Baiduri Bank has released a new brand promise: ‘Co-creating your future.’ Baiduri CEO Ti Eng Hui explains what the promise means for the bank and its customers, how Baiduri’s renewed focus on purpose-driven banking has changed the way it operates, and the new ways the bank is engaging with its local community.

You can also watch the second half of this interview, where Ti Eng Hui discusses Baiduri Bank’s most important CSR programmes, and how it supports Brunei’s MSMEs.

World Finance: What does this promise mean to you, and how have your customers responded to it?

Ti Eng Hui: So this is a very clear message we want to send to the community: that we are there with them throughout their journey. Whether it’s their financial health, or whether it is their physical health, we want to be there with them.

We want to be in fact also their long-term preferred financial partner. If they run businesses we also want to be there when they’re small, and along the way we’ll support them so that they can grow.

And at the same time we make sure that they’re given all the tools and financial advice possible to grow their business. Bring in the relevant government agencies, give them the relevant marketing support.

So that’s the message we want to send; we’re always there for them, co-creating the future together.

World Finance: And how has this renewed focus on purpose-driven banking changed the way that Baiduri operates?

Ti Eng Hui: So, because of this purpose focus on helping customers, co-creating the future together, the team now looks at what they do very carefully, to make sure that whatever that we do is there to support the customers.

From the way we advise to them, to the way we process it. From the way we plan their future, we are there all the way for long term.

So I think our staff has taken it as a challenge, our staff has taken that as a way to make sure that whatever we have developed for them, whatever we plan for them, is good for them – not just for the short term, but also for the long term.

World Finance: And you’re walking the talk with the new headquarters that I mentioned; tell me how it improves your environmental sustainability, and your ability to engage with the community.

Ti Eng Hui: So our new head office is a prime example of what we’d like to do in Brunei going forward; it’s that we want to bring the sustainable into Brunei: environmentally, also financially. We want to make sure that the environment aspect of it benefits everybody: the surrounding that we have developed, in terms of the landscaping, the green, is also benefiting the neighbourhood. Really from the moment you walk in you can sense this is a very green building, very environmentally sustainable.

The building also incorporates what we call Baiduri Community Space on the top floor – essentially a space for the community to use for their art events, for their cultural events, free of charge. It is about being a responsible corporate member, how we can help the communities come together, how we can engage them. So this is what we mean by co-creating our future together.

World Finance: Ti Eng Hui, thank you very much.

How Baiduri Bank supports Brunei’s MSMEs: From tech training to matchmaking

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Along with its fresh rebrand and new environmentally sustainable headquarters, Baiduri Bank has released a new brand promise: ‘Co-creating your future.’ And that doesn’t just mean for its retail customers, where Baiduri is innovating through its branch network and mobile devices; or for its business clients, where the bank is collaborating with government to help MSMEs embrace technology. It also means for the community, where Baiduri is giving back through a number of impactful CSR initiatives. Baiduri Bank CEO Ti Eng Hui discusses all of these in this video; while in the first half of this interview he talks about the commitment to sustainable banking and long-term customer care that ‘co-creating your future’ represents.

World Finance: I’m back with Ti Eng Hui, CEO of Baiduri Bank; you’ve launched a number of important CSR programmes in the last few years, talk me through some of the most impactful schemes.

Ti Eng Hui: So, one of them that we have launched recently is, together with an NGO, we’ve worked with the Ministry of Education to help students to learn Low Impact Living. So we thought that’s something that is very important to have that developed at a young age. So when the children go back home they will tell their parents. And we thought that is one way we can help, in terms of supporting the community.

We have also launched, just before the second wave of COVID last year, a national platform for volunteerism, to allow volunteers to come forward and help those patients in need, those nurses in need, those medical staff in need. And the impact has been tremendous. So we are really grateful for the opportunity. And it’s really something that we’re very proud of.

World Finance: And how is Baiduri supporting Brunei’s micro, small, and medium enterprises – especially as customers increasingly adopt a digital-first mentality?

Ti Eng Hui: So we work with a government statutory department called Darussalam Enterprise to run workshops covering marketing, accounting, and technology, to make sure that the MSMEs can embrace technology.

We also run business matching forums so that MSMEs can become suppliers to this bigger group of companies.

So we thought that would, you know: put it together, help each other. In terms of supporting the local businesses, the smaller businesses. And allowing the bigger businesses to do their part in helping the smaller guys.

World Finance: Baiduri Bank has committed to an omnichannel approach to customer service; how are you innovating in both the digital space and your physical branches?

Ti Eng Hui: So what we have done with the branch footprint is that we have increased the ATM space and reduced the counter services. At the same time we throw in digital services, where of course customers can come in; if they’ve a problem using their mobile phone or internet banking, they can get support from there.

But what is important is that on the technology front we have adapted the latest technology and optimised into the banking for mobile phone usage. Customers can sign on using biometrics, so that provides a new level of convenience.

Customers love the experience so far, we’ve got very good sign-ups and we’re hearing fantastic stories.

We also have rolled out the AI chatbot called Emmi, which allows customers to send in messages, and they get the response immediately for any enquiries that they have.

So these are the current technologies that we have deployed, and I think customers have responded very well so far.

World Finance: Ti Eng Hui, thank you very much.

Ti Eng Hui: You’re most welcome.

‘All of Portugal is booming’: Real estate golden visa draws investors

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Portugal’s residency by investment programme, one of the most popular golden visas in the world, rolled out some changes in January 2022: in particular, investment in coastal residential properties no longer qualifies investors for the scheme. Still, with about five percent rental income per year and capital appreciation of up to four percent a year, residential units in the interior of Portugal are still an attractive proposition. David Machado and Tiago Camara of PTGoldenVisa discuss the changes to the scheme, the residential and commercial investment opportunities available throughout Portugal, and the larger real estate projects that PTGoldenVisa has started offering to its investors.

World Finance: David,what changes were made earlier this year, and how has the market responded?

David Machado: Yes, the Portuguese golden visa programme hasn’t changed that much: we still maintain the same categories.

It’s true that from January 1st 2022, we no longer can qualify with investment in residential properties in the coastal areas. But we have quite interesting opportunities in inland areas, we’re seeing quite good results, and the reality is, all of Portugal is booming at this stage. So it’s expected to have very high capital appreciation on these investments, even for those who choose to invest in inland areas to qualify with residential properties.

World Finance: Tiago, tell me more about those investment opportunities.

Tiago Camara: In the category of €280,000 in the interior of Portugal, the majority of our properties are residential units, with 2-3 bedrooms in regions with easy access, good logistics and infrastructures. In these regions we normally agree with the local developers for them to rent these properties and guarantee our investors four to five percent rental income per year. The capital appreciation expected ranges from two to four percent a year.

On the high density areas, the investment goes up to €350,000. Lisbon keeps on being the most requested region, where we have been successful in selling offices and shops to our clients, providing them around four percent rental income guaranteed. And four to six percent capital appreciation for this type of properties.

Another region in very high demand is Madeira island. It qualifies investors for a golden visa with €350,000 investment. Madeira is a region packed with tourists all over the year, very well connected with all European cities by air, and with a real estate market appreciation of more than 10 percent every year.

World Finance: Now David: who are your clients? Where are you seeing the most interest from around the world?

David Machado: Yeah, the Portuguese golden visa programme targets all the non-European Union citizens. We are seeing these days an extra effort from North Americans coming to Portugal and doing a lot of investments, so that’s a bit of the change that has happened in the past year. Before the main investors were Chinese, and they’re still a big part of the golden visa programme.

The programme continues to reach all over the world; people who are looking for a backup plan for their families, opportunities to relocate, to enjoy retirement days in Portugal, have access to premium healthcare facilities, premium education. All those benefits – together with the free ease of movement once you have a residence card from Schengen countries – it’s what attracts investors to come.

Plus, after five years you qualify to access citizenship, so those are the benefits that are bringing people from all over the world.

These days I would say investment, just the pure investment in real estate in Portugal is delivering very high returns, so it’s also something to watch.

World Finance: You successfully support over 100 investors every year to apply to the Portuguese residency program – what kind of experience do you offer to your clients?

Tiago Camara: First of all, we are a one-stop shop service provider, managed by two Portuguese experienced managers, with a full knowledge of the Portuguese real estate market. We have a team of around 40 professionals based in Portugal, guaranteeing our clients on a daily basis full scope of services that they need to proceed with their investments and residency programme.

We support our clients specifically on selecting the best investments, opening their bank accounts, having a tax number in Portugal. We support them on finding the best law firms to support them in the programme and on the investment. And we guarantee very professional management of their assets in Portugal. We manage their properties, and we are able to generate them very good returns on their investments.

World Finance: And what does the future hold for PTGoldenVisa?

David Machado: We are still very focused on delivering a high level of service to all our clients. So the idea that we continue to provide this service from A to Z, which provides a full solution from any client wanting to invest in Portugal and collecting the benefits. This is mainly our focus.

However, because our database of clients is pretty large, and we have been overseeing great opportunities in terms of real estate deals, we also focus now on bigger developments – let’s say hotels, where we are providing development of hotels for clients. Or aparthotels, or bigger projects to develop compounds. So those are projects that PTGoldenVisa is now also focused on, which are not directly related to the golden visa, but most of the time also involve investors which have started with the golden visa now doing other investments with us.

EVO Banco celebrates 10 years of transforming Spain’s financial services

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As EVO Banco marks a decade of providing transformative financial services to the Spanish banking market, Javier Gonzalez and Pedro Tomé reflect on its successes, challenges, and future: including its innovative voice banking virtual assistant, the question of how to convert customer growth into income growth, and soon-to-come services that will help make the difficult, easy.

World Finance: Javier, obviously 10 years is an incredible milestone; what are some of the most important innovations you’ve brought to market in that time?

Javier Gonzalez: It is; well, looking back over this period, I think that the real, the actual innovation of EVO Banco was itself to create this innovation culture. You need to have innovation as a pillar, as to permeate to all the organisation. Because it’s not about having just an innovation department in an isolated way.

And we did a lot of things. We were pioneers in using the cloud in banking, something that was unthinkable in 2014. We created an amazing app with SLN UX. We collaborate with very famous fintechs, and with Google, with Microsoft, with Amazon, in very interesting innovation projects.

But if I had to mention one single project, probably I would highlight our virtual assistant. Right now our clients can do all their banking operations just by talking, in a natural way, like with a human but 24/7.

So I think that this is a clear example of how to put innovation and artificial intelligence to the service of our clients; it’s great.

World Finance: You’ve seen tremendous double digit growth in customer numbers since 2020, breaking 900,000 in February last year. What products or services have been most successful in growing your base?

Javier Gonzalez: I wouldn’t say it’s just a matter of one product or two; I think it’s a compendium, the 360° package that we’re delivering to our clients.

You know we have this big difference between the traditional banks, that are offering traditional products: loans, mortgages; and we also have these new banks or fintechs, and they are doing very good stuff in very specialised features.

Our position has always been to have the best of both worlds.

I think that we are a neobank in the sense that we can do specialised and cool features; but also we want to be there in all the lifecycle of our clients. So we need to offer all the kinds of products. This is key for our clients to consider us as their primary bank.

Another critical factor I think is quality. The digital client is highly demanding. No matter if you did well for a long time, if in some moment you fail, they can abandon you in no time. So we are putting a lot of effort into better quality services, to meet the quality that our clients are looking for.

World Finance: Now, growing your base so rapidly has come at the cost of profitability; what’s the strategy for converting that customer growth into income growth?

Javier Gonzalez: Well, we are not growing by growing; indeed, we are not investing a lot of money in ad campaigns or something like that. Because we are not financed by venture capital, so we need to take care about where we put every euro. We cannot build products or try to grow without a clear plan for having a return in the short or mid-term.

They key to monetisation is the client engagement. So if we are able to demonstrate to our client that we are going to be there in all their lifecycle, having better services with better quality, then monetisation, or the income growth, is going to appear in a natural way.

World Finance: Pedro, key to that monetisation is going to be understanding your customers really well; how can you offer personalised services in an intelligent way?

Pedro Tomé: Well, personalisation is one of the keys to the future. At EVO Banco, we always pay attention to our clients’ concerns. Based on their needs, we have developed different applications, products and services that can be useful to the life of the clients – that’s important here.

These applications are based, for example, to organise better their finance, or to encourage the security of their transactions. Even a tool to make comparisons with others, in order to manage better their money. So the idea here is to make the difficult, easy.

At EVO Banco we are working to create a bank per person, not a bank for all. Which covers all the necessity of each customer, wherever and whenever they need.

World Finance: And how about for the next 10 years? How is EVO Banco going to continue to innovate?

Pedro Tomé: Well, 10 years is a lot of time. Of course, we will continue pushing and leading the line of voice banking for the future. We truly believe in that.

As Javier said, we create a culture of innovation at EVO Banco, and we define different lines of innovation. Three of those are: personalisation, user experience, and security. So, different products and services will be presented in the coming years along these lines.

An example of that, close to release, could be the mortgage timeline. This is a service to the clients that they can follow the application throughout their mortgage, in real time. The idea is to reduce the frustration of the client, and make easier this complex product.

And for the far future I can tell you that we are exploring different emerging technologies to be applied to the financial sector that can be useful to the client.

And also who knows: maybe in the future an emerging ecosystem like the metaverse will be something real, and we will be there.

Something I can tell you: you have to keep following us to see what happens in the future.

World Finance: Well we certainly will. Javier, Pedro, thank you so much.

Javier Gonzalez: Thank you so much.

Pedro Tomé: Thank you.

Udom Emmanuel: Behind and beyond the Akwa Ibom success story

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Udom Emmanuel took governorship of the Nigerian state Akwa Ibom in 2015. Since then he has transformed the southern coastal region from a civil service state into an attractive destination for private enterprise; one of the best states in the country for bringing in foreign direct investment. In this fifth and final video from the hour World Finance spent in the studio with Governor Udom Emmanuel, he explains what first motivated him to run for political office, what he’s most proud of in his time serving the people of Akwa Ibom, and addresses the political groups who called for him to stand in the 2023 presidential election.

World Finance: We’ve talked about your corporate career, but of course in 2015 you moved back to your home state to start your political career. What drove this, what motivated you?

Udom Emmanuel: Service. Service. I came from a background that we… when I started in the financial system, we started running what we call People, Service and Technology. I could see that the people and the service needed a little bit of, you know, a handshake, somewhere.

And to also bring to bear what we’ve learned, what we’ve seen working, what we’ve delivered. The capacity that we have in that one word. To serve the people.

World Finance: When you became governor, did you have any vision in mind, any sort of, key objectives that you thought: well, if I can achieve this, then I know my time will have been a success?

Udom Emmanuel: Oh sure! I set that up in many points that we can actually try to look at our political and economic inclusion. We can look at the infrastructure renaissance. The social services. And also the youth empowerment and youth development. If we build on this then certainly I would be satisfied as a person.

Look at the industrialisation policy, and then run with that. I never knew when I set up those policies that we would shut down the whole world for almost two years! But be that as it may, I would score myself that we have done minimum of 80 percent of that, and we believe we can still achieve minimum of 90. Because we still have one more year. A year means a whole lot in delivering on these promises to the people.

World Finance: What are you proudest of, in your time as governor? And, what do you think your legacy will be?

Udom Emmanuel: Number one, I would pride myself as that person that came in with the reorientation of the minds of the people, under what I call the Dakkada philosophy. Where we got people to believe that what you have is all that you need. And once you have the passion, nothing’s impossible.

I would also pride myself on that governor who came in, who ran after peace, and who restored peace. Who understood the source of peace, the principles of peace, the architect of peace, and then the benefit of peace. And I sought after that, and we achieved it.

World Finance: We are nearly out of time; I cannot let you go without asking you this final question. A number of political groups have come forward to directly suggest that you should run in the 2023 presidential elections. Obviously I’m not expecting any kind of grand announcement here today, but purely hypothetically: if you were to run, if you were to succeed, what do you think you would you do differently? What do you think needs to be changed?

Udom Emmanuel: If I were to be given the opportunity? Well, I would look at certain policies and principles, and first of all localise them to our own people, to see how they work.

I know that I need a whole lot of my knowledge within the public and the private sector. I wouldn’t deny the people of that knowledge, that experience or that capacity.

But I would behave as I need everybody. All hands to be on deck. Nigeria is a country of 200 million people, and inside those 200 million people there are a lot of eggheads that can make a difference. So I would go after those resources. Because what you have is all that you need to make what you want.

World Finance: Governor, once again, thank you very much.

Udom Emmanuel: Thank you so much.

Udom Emmanuel: Private sector discipline is seriously needed in public sector

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Udom Emmanuel took governorship of the Nigerian state Akwa Ibom in 2015. Since then he has transformed the southern coastal region from a civil service state into an attractive destination for private enterprise; one of the best states in the country for bringing in foreign direct investment. In this fourth video from the hour World Finance spent in the studio with Governor Udom Emmanuel, he reflects on his private sector career, how it has informed his public sector governance, and gives the former banker’s view on the Nigerian economy.

World Finance: You were CFO of Zenith Bank for a good long time, so let me ask you, how do you feel your private sector career has influenced your public sector one?

Udom Emmanuel: I want to say here, based on my knowledge and experience on both ends, that management principles are all the same. If you cannot manage a shop, you cannot manage a multinational. If you cannot manage a multinational, you cannot manage any government.

And people do ask: which one should come first? I think the knowledge of the private sector is actually what should move you to go and manage public enterprise. Because you see, there’s what you call the business of governance. Those principles that could guide you, that discipline that you have in the private sector: you need it seriously in the public sector.

The discipline of time. Discipline of decision making. The discipline of planning. The discipline of business and analytical reviews of decisions taken. The discipline of sensitivity analysis of different policies and decisions taken. It’s needed also in government!

For example, I run a state with a population of 7.2 million people. So a single decision that you are taking can really affect the people a whole lot.

You know, in the business world, the question that people are always asking is, does it conform to the best practices? So I don’t think that question should be far also from government.

You also notice that in public sector, there’s less emphasis on mode of execution, less emphasis on measurement standards. Which are key parameters of success in the private sector. So we bring that also in here.

World Finance: Currently just 64 percent of Nigerian adults are financial included; what needs to happen? Can the states do more, can banks do more? How important is getting the rest of Nigeria financially included?

Udom Emmanuel: There was a time that financial inclusion was the order of the day. That was when we started the era of community banks: small financial institutions to actually take the financial system to the locals.

But we didn’t keep faith to that. It was a fantastic policy, but the execution was completely different from what we had on paper.

Let me give you an example. We wanted to substitute all those financial inclusion structures that we set up at that time with plastic money. You can’t run plastic money in a system where the local dwellers do not have access to anything. They can’t even run a smartphone, no base stations. So many things are absent. So much infrastructure is working against them. How can you run plastic money in such an area?

Let us not move ahead of what the people and capacity can carry. It means we have a long way to go.

World Finance: What is the ex-banker’s view of the Nigerian economy today?

Udom Emmanuel: As an ex-banker I think we can do better than where we’re at today. We don’t have any reason to be where we are today, honestly. And we have many reasons to be ahead of where we are today.
I still believe a few management principles are being ignored, somewhere. Or we’ve overlooked them, or we have mismanaged, in a few cases. There are some economic policies that are not in line. And there are certain things that we’ve also done that we didn’t also look at the social, cultural structure, of Nigeria.

I want to believe that we stand a chance to correct those things. They are not things that could lead to death, but they are things that could cause sickness.

Nigeria today needs somebody who has the knowledge of the private and the public sector, and the knowledge of the economy, to steer the affairs of the country. And see whether we don’t get a result. I think that’s a simple solution.