The Chief Executive Officer of NOUN Microfinance Bank (NOUNMFB), Mr. Sani Katuka, has unveiled a comprehensive turnaround plan aimed at repositioning the bank as one of the biggest microfinance banks in the country.
He said NOUN micro-finance bank is a Central Bank of Nigeria (CBN) licensed, Tier 1 Micro-finance bank, which positions it at par with other financial institutions in the country to transact the university’s financial services.
Speaking with the NOUN News in Abuja on the bank’s journey and future, Katuka said the bank was established in 2014 during the tenure of the former Vice-Chancellor, Prof. Vincent Ado Tenebe, following the practice of renowned universities owning microfinance banks to service their financial ecosystem.
He noted that despite being in existence for over ten years, the university has not fully patronised the bank due to several structural and operational challenges.
The MD said “the bank was established as a Public-Private Partnership (PPP). Under the arrangement, the university holds 25 percent shares, the University Cooperative 15 percent, Tanadi Investment 5 percent, while one of the key investors, Engr. Abubakar through Spectrum Construction, holds 5 percent, among other shareholders.”
According to him, challenges began from the pioneer management and staffing model, where university staff were deployed as bank staff. “The university is regulated by the NUC while the bank is regulated by the CBN. The two systems are different,” he said.
He revealed that no share certificates were issued to shareholders for ten years and the bank was run “like a glorified cooperative society,” without basic compliance documents such as a Tax Identification Number (TIN).
This, he said, was compounded by poor lending practices, where loans were granted without recourse to banking regulations and could not be recovered, leading to loss of trust and no return on investment for shareholders.
Katuka, who assumed office as Managing Director in January 2024, said on assumption he conducted a needs assessment following several activities of the bank flagged by regulatory agencies.
He said the first step was to convene a meeting of major shareholders and stakeholders, where a new Chairman of the bank was announced and he was unveiled as the new MD. At that meeting, the bank also shored up its capitalization.
The second phase, he said, was the recruitment of key management staff and professional bankers to drive the new vision of the bank, as is stated in the CBN statutes.
Katuka disclosed that the next phase was full digitisation of the bank’s operations. He said the Chairman has approved the development of a Core Banking Application, mobile banking, loan application and payment gateway, which has already been completed.
“We are transforming NOUNMFB into a technologically advanced, professionally managed institution, poised to deliver exceptional financial services to the NOUN Community and beyond.
“We now grant soft loans to staff within 24 hours at competitive interest rates. We want to perfect our financial dealings within the university environment before extending to the larger society,” he said.
He added that the University Governing Council, at its last meeting, mandated the University management to patronise and support the bank through sundry payments including school fees and other university transactions.
As the bank was established to service the financial affairs of the university, the MD added, they do not need to open branches all over the place but can leverage technology to expand its services.
To this end, the bank also plans to establish Quick Service Points in some study centres across the country to start disbursing debit cards, POS machines and to attend to staff and students.
“With the number of study centres across the country and the student population of NOUN, this bank has the potential of becoming one of the biggest microfinance banks in Nigeria. Our five-year strategic plan aims at generating massive investment enough to support the university’s infrastructural drive,” Katuka said.
He explained that everything is now in place after two years of rigorous work, which ensures proper staffing, and the regulatory bodies are now well on board with the bank.
Katuka, who said CBN was at the bank as recently as last week and is fully satisfied with the operations of the bank, added that only the patronage from the university remains, which, by the Governing Council’s recent decision, is also well in the offing.
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