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Microfinance Banking

Integrated Microfinance Bank. A presentation by Segun Adaju Deputy Managing Director/COO Integrated Microfinance Bank Limited at NECA's Network of Entrepreneurial Women (NNEW) General Meeting Lagos Sheraton Hotel and Towers, Ikeja February 28, 2007. .. Preamble. Growth Vs Development.

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Microfinance Banking

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    1. Integrated Microfinance Bank Microfinance Banking .

    2. Integrated Microfinance Bank A presentation by Segun Adaju Deputy Managing Director/COO Integrated Microfinance Bank Limited at NECA’s Network of Entrepreneurial Women (NNEW) General Meeting Lagos Sheraton Hotel and Towers, Ikeja February 28, 2007 .

    3. Preamble Growth Vs Development

    4. Posers… Total theft and wastages in Nigeria since independence is about $400 billion - World Bank/EFCC Statistics

    5. Posers… Current foreign reserves is in excess of $40 billion - CBN Statistics

    6. Posers… Nigeria is 13th largest oil producer in the world with 32 billion barrels of oil reserve, enough for 37 years - CBN Statistics

    7. Yet… Over 75% of Nigerians live below 1$ (N140) per day! - World Bank Statistics

    8. Still Yet…

    9. Posers… Why the WIDE disparity between figures and reality?

    10. Posers… The difference between growth and development

    11. Posers… …and sustainable Human Development

    12. The ONLY Promising Solution… MICROFINANCE BANKING

    13. What is Microfinance? Microfinance is about providing financial services to the poor, unbanked and entrepreneurs who are traditionally not served by the conventional financial institutions

    14. What is Microfinance? Micro savings Micro loans Micro insurance Payment transfer Capacity building

    15. What is Microfinance? What is a “Micro loan”? Amount – smaller in amount than typical business loan Tenor – shorter and depends on client’s cash flow pattern Repayment schedule – frequent, sometimes daily, weekly or bi-weekly payments. Security – character and business cash flow. Sometimes backed by guarantees. Interest rates – higher for micro loans or forced savings are required. Training – participation of prospective borrower sometimes a prerequisite to receiving credit

    16. Microfinance – Indonesia Example Bank Rakyat Indonesia (BRI) – one of the world’s leading micro finance institutions (MFIs) Has 4,049 BRI Unit desas (village banks) with 96% profitable Has staff strength of over 20,000 As at Sept 2004, BRI had 87% of its loan portfolio in micro loan More emphasis on savings with deposit/loan ratio of 225% BRI is the largest bank in Indonesia and the most profitable and efficient Made a PBT of N30b and had a deposit base of N400b in YR 2005. IPO was successfully oversubscribed 15 times in 2003

    17. Bangladesh - The Grameen Bank Idea born in 1976 by Prof. Yunus when he loaned $27 from his pocket to 42 stool-makers, women Bank was established in 1983 in Bangladesh Today, it has 1,800 branches and works in 42,127 villages, with a loan portfolio of $4b to 2.6m borrowers 95% of its 2.6m customers are women! Has granted a total of 6.6m microloans. As of 2006, Grameen Bank had achieved a 98.84% repayment rate Has made profit every year since inception, except 1983, 1991 and 1992.

    18. Bangladesh - The Grameen Bank Started business in 1983. 1991 and 1992 were years of massive rehabilitation for members of the bank after the devastating cyclone of April 1991 Has a staff strength of over 12,000 Has authorised capital of $11m and s/holders’ funds of $142m Has diversified into Telecomm with Grameen telephones More than 250 institutions in over 100 countries operate the Grameen methodology of micro-credit programs Founder and Grameen Bank won the Nobel Peace Prize for Year 2006.

    19. The Facts Nigeria is 13th largest oil producer in the world with 32 billion barrels of oil reserve, enough for 37 years The second largest economy in Africa with annual GDP of $71b One in every five African is a Nigerian! Yet… Over 75% of the population live on less than $1 per day (World Bank Statistics) Over 65% of the people are excluded from financial services Bank outlet/client ratio in rural areas of 1: 57,000 Only one million of about 60 million clients access formal micro finance services (less than 2%) Micro credit as a proportion of GDP is 0.2%, whereas the informal sector accounts for over 70% of GDP

    20. The Facts Micro credit as a proportion of total credit is 0.9%, whereas total credit of N2.4 trillion as at December 2006 was given to ONLY 36,000 borrowers! The microfinance market in Nigeria is the largest in Africa and third largest, untapped market in the world According to CBN, 84% of money in circulation (currently estimated at N630b as at December 2006) is outside the formal banking system. The market is estimated at $40b (N6 trillion) with a potential client base of 60 million customers. The total assets of all universal banks in Nigeria as at December 2006 was is N6.6 trillion The formal banking system in Nigeria caters for about 20% of the population, mostly in urban areas

    21. Integrated Micro Finance Bank Ltd Our Profile

    22. Our Vision To be the leading micro finance institution in Africa.

    23. Our Mission We are committed to create a leading micro finance bank in Nigeria that would facilitate financial empowerment to the poor and unbanked, deliver superior values to stakeholders through a highly motivated workforce and efficient technology while remaining socially responsible

    24. Our Payoff …banking at your doorstep.

    25. Integrated Micro Finance Bank Ltd Promoters: S.A & S.A Integrated Services Ltd Board of Directors: Dr. Mrs. Doyinsola Abiola - Chairman Simon Akinteye - MD/CEO Segun Adaju - DMD/COO Dr. Jerry Ariomovuohoma, M, IoD Babalola Owoeye Demilade Adepoju Technical partners - ECIAfrica, S.A. - World Bank/MSME Project

    26. Integrated Micro Finance Bank Ltd Management Team: Simon Akinteye BSC, ACA, MBA - MD/CEO Segun Adaju BSC, MBA - DMD/COO Lawrence Ojebode HND, ACA - GH, Operations Coleman Oshadami BSC, ACA - GH, Retail Adewale Oyebamiji MBA, ACA, ACTI - GH, FINCON/Strategy Seyi Olojede HND, ACA - Head, Internal Control Chimaobi Agwu BSC, MSC, MBA - Head, Risk Mgt Titilayo Osinubi LLB, BL - Head, Legal Services/HR Tunde Thomas BSC,MBA - Head, Enterprise Banking Jennifer Egbujie BSC, MSC - Head Quality & Comm. Dr. Bimbola Ogunniyi MBDS, MBA - Head, Treasury

    27. Our Products Micro credit Working capital loans Micro leasing Consumer Finance Micro savings Modified Daily Contributions IMFB beneficiary account ROSCA account etc Micro insurance Payment transfers 5. Capacity building school everywhere, ‘I dey learn’

    28. Our Record Total number of accounts opened - 33,426 Total borrowers - 1,908 Total deposits - N453m ($3.57m) Total balance sheet size - N648m ($5.1m) Total loans disbursed - N362m ($2.85m) Outstanding as at February 22 - N273m ($2.15m) Repayment rate - 98.5% Authorised Share Capital - N500m ($3.94m) Paid-up Share Capital - N215m ($1.7m) Staff strength - 501 Field Offices - 30 IT Capacity - 4m clients Projected Grant (World Bank) - $2m Projected Paid-up Capital-Sept 2007 - N1.0b ($8m)

    29. . Thank you for your attention.

    30. . Questions and comments

    31. . Integrated Microfinance Bank Ltd 64, Adeniyi Jones Avenue Ikeja, Lagos Tel: 2716530-9 Email: info@imfb-bank.com Website: www.imfb-bank.com

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