Indeed, businesses which are surviving the unpalatable economic terrain that Nigeria is currently passing through deserve commendation.
However, this has not stopped Industry Watchers from seriously criticizing Heritage Bank Limited, following its inability to impress despite the acquisition of Enterprise Bank Plc in 2014.
Prior to its acquisition of Enterprise Bank, for two years, Heritage Bank Limited carried out its business activities without making the contents of its books public.
Heritage Bank Limited not only failed to declare it books, it also didn’t declare profit. Basically, the business under its Managing Director (MD) and Chief Executive Officer (CEO), Ifie Sekibo just couldn’t make profit.
Talks of trading in the Nigerian Stock Exchange (NSE), also pervaded the air with promises from the management of the bank failing to come through till date.
That aside, in August 2014, Heritage Bank Limited acquired Enterprise Bank, subsequently they merged and integrated amidst initial technical issues and complains by account holders.
However, all these are child’s play compared to the damning criticism which is coming the way of the bank following a 1.5 billion profit it declared for the years 2015.
In Enterprise Bank’s results for the year ending 2012, its gross earnings increased significantly to N40.4 billion, compared to earnings of N10.5 billion in the five-month period ended 2011.
The bank also realised a profit before tax (PBT) of N11.3 billion in 2012, as against a loss of N5.2 billion recorded in the five-month period it operated in 2011.
Also, its customers’ deposits grew from N162.6 billion in 2011, to N208.4 billion in 2012, just as its total assets climbed from N198.5 billion as at the end of 2011 to N261.1 billion in the year under review.
It is therefore shocking that a year after Heritage Bank Limited’s acquisition of Enterprise Bank it is declaring a profit of 1.5 billion.
This, analysts have said is below expectation, as a reform of the banking industry is being called for.
Questions such as how the Asset Management Corporation of Nigeria (AMCON), sold Enterprise Bank to Heritage Bank Limited resurfaces again. Industry Watcher are also wondering how Heritage Bank Limited declared a less impressive result despite its acquisition of a viable bank such as Enterprise Bank.
could declare better profit are being asked.
Industry Watchers and analyst are presently calling on the Central Bank of Nigeria (CBN), to reduce the number of banks in the country to at least five via mergers and acquisitions.
Presently, Nigeria has 21 banks, as compared to five in South Africa, which is the second largest economy in the continent.
If (CBN) will follow this line remains to be seen.
Related News: Enterprise-banks-acquisition-gets-messieras-heritage-bank-goes-to-court/
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