Monday, 1 February 2016

Nigeria: UBA, Zenith, Firstbank, Others Make Global Top 500 Banks

United Bank for Africa Plc and Zenith Bank Plc are among the four Nigerian banks listed among the global top 500 bank brands.
According to the rankings, First Bank of Nigeria Ltd retained its number one banking brand ranking in Nigeria for the fifth consecutive year in the 2016 The Banker and Brand Finance Top 500 Banking Brands in the world.

According to the 2016 Top 500 banking brands ranking published in the February edition of The Banker magazine, Financial Times Group, in conjunction with Brand Finance, London, United Kingdom, First Bank moved up the scale by 16 places, from 336 position in 2015 to 320 this year.
The country representative of The Banker magazine in Nigeria, Mr Kunle Ogedengbe, said in a statement yesterday that that three other Nigerian banks also made the ranking.
They are Guaranty Trust Bank (GTB) which moved to 389 in the world, from 417 in 2015; Zenith Bank that dropped from 388 in 2015 to 392 in 2016, and United Bank for Africa (UBA) that returned to the ranking in 447. Access Bank that made the ranking at 496 in 2015 dropped from the 2016 ranking.
First Bank's brand value, which is the licensing rate that a third-party would need to pay to use the bank's brand, increased to $322 million in 2016 from $300 million in 2015 while that of GTB also increased to $243 million from $213 million.
The 2016 brand value of Zenith Bank increased to $238 million from $235 in 2015 while UBA, which made a return to the ranking since 2012, has a brand value of $198 million. UBA's brand value in 2012 was $121 million.
For the ranking's methodology, Brand Finance obtained brand-specific financial and revenue data; modelled the market to identify market demand and the position of individual banks in the context of all other market competitors; established the royalty rate for each bank; calculated the discount rate specific to each bank, taking account of its size, geographical presence, reputation, gearing and brand rating, and discounted future royalty stream (explicit forecast and perpetuity periods) to a net present value - which is the brand value.
This approach is used for two reasons: it is favoured by tax authorities and by the courts because it calculates brand values by reference to documented third-party transactions which can be arrived at through publicly available financial information.
Of the five countries in Africa that made the ranking, Nigeria has the highest brand value increase of $249 million. Egypt moved up by $239 million; Togo gained $134 million while South Africa and Morocco lost $878 million and $213 million respectively.
Globally, Wells Fargo of the United States of America (USA) retains the number one banking brand in the world for the fourth consecutive year.
It was followed by banks in China and United Kingdom in the first ten. Wells Fargo's brand value for 2016 is $44.1 billion from $34.9 billion in 2015.
The remainder of the top ten banks in the world are ICBC (China), China Construction Bank, Agricultural Bank of China, Chase (USA), Bank of China, Bank of America, Citi (USA), HSBC (UK), and Barclays (UK).
The Banker, in its 90th year, is an un-rivalled coverage of global finance and banking publication from the group of Financial Times Newspaper which is regarded as the most influential newspaper in the world. It is the definitive publication that provides guide to bank ratings and analysis globally and the definitive reference on international banking for finance experts, governments, chief finance officers, CEOs, central bank governors, finance ministers, and other decision makers globally.
The Banker's Top 500 Banking Brands ranking, in conjunction with Brand Finance, measures the value of financial services firms across the world, analysing specific sectors and geographies, and identifying the brands that have improved the most, as well as those that have suffered the greatest setbacks.
New electricity tariff regime begins today
FCT residents, environs now pay N23.6 per hour from N14
Electricity consumers in the country will from today begin to pay increased tariff as announced by the Nigerian Electricity Regulatory Commission (NERC) under the Multi-Year Tariff Order (MYTO) 2015.
NERC, which set the take-off of the new regime for February 1, 2016, noted however that there are inbuilt consumer protection mechanisms and incentives for improved service delivery by the Discos and fair return on investment in the new tariff order.
Under the new tariff, residential customer category (R2) in the Federal Capital Territory (FCT), Niger, Nasarawa and Kogi states, which fall under the Abuja Electricity Distribution Company (AEDC) franchise, who previously paid N14 per kilowatt/hour, will now pay N23.60 per kilowatt/ hour.
In a similar vein, residential customers in Eko and Ikeja electricity distribution areas will be getting N10 and N8 increase respectively in their energy charges. The same situation applies to residential customers in Kaduna and Benin electricity distribution companies who will see an increase of N11.05 and N9.26 respectively in their energy charges.
Meanwhile, the minister of power, works and housing, Babatunde Fashola, has explained that the new MYTO due to commence today is aimed at correcting the whole system in the entire value chain of the power sector, and said it was the most viable means of achieving steady power supply in the country.
Fashola, who spoke in an interview with journalists at the site of the 2 X 60 MVA 132/33 KV Sub-station Kukwaba power project during his nationwide inspection, verification and fact-finding tour of projects under his ministry, said the ready acceptance of the new tariff order would also galvanise the sector and boost investments, which would in turn usher in more development in the country.
Consequent upon the increase, the NERC has abolished the controversial monthly fixed charge payment and also reiterated its directive to the distribution companies (Discos) to abide by its order not to connect new customers without first providing them with meters, in order to ensure customers pay only for what they consume.
According to the acting head of the Commission, Dr. Anthony Akah, the removal of fixed charge under the new tariff regime "was in response to electricity consumers' complaints and a measure to ensure electricity distribution companies improve on service delivery as their income is dependent on the quantity of electricity used by their customers.
"The Commission, in implementing this cost reflective tariff, will effectively monitor and enforce all service delivery agreements in the new tariff order.
The new tariff order, aside from eliminating fixed charge, has a robust mechanism to ensure that electricity distribution companies fully meter their consumers and eliminate 'crazy' billing within one year," Akah

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