From Omoluabi to LivingTrust: A Lesson in Value Creation

Any time a record of the outstanding successes of Governor Gboyega Oyetola-led administration in Osun State is being compiled, the story of LivingTrust Mortgage Bank Plc will definitely hold a pride of place. The reason is not farfetched. The decision of the state to cede its majority shareholding in the bank to a private equity investor earlier this year has proven to be one of the best decisions any government could ever make.

It was therefore not a surprise when a similar progressive decision was taken by the Osun State Governor on the ownership of Ladoke Akintola University of Technology (LAUTECH).

Since the bank, originally known as Omoluabi Mortgage Bank Plc, was taken over by leading pan-African financial services provider, Cititrust Holdings Plc, in May last year, it has recorded tremendous achievements, which has not only won it several recognitions, but also catapulted it to the ranks of foremost mortgage lenders in the country, with guaranteed superior returns for investors. An immediate proof of the latter point was the growth in the bank’s profit by an unprecedented 2,039 per cent in the third quarter of 2020 compared with the corresponding period in 2019.

The bank’s profit after tax also increased from a meager N3.34 million in third quarter of 2019 to an impressive N71.43 million in third quarter of 2020, while its total assets increased from N4.6 billion as of the last day of business in 2019 to N5.3 billion as of September 30, 2020.

Also, in its Projected Income Statement for 1st Quarter ending 31st March 2021, sent to the Nigerian Stock Exchange, the bank expects gross earnings to rise to N413, 632, 402, while profit after tax is projected to rise to N85, 010, 977.

Apart from changing the name of the bank from Omoluabi to LivingTrust Mortgage Bank Plc, the new core investor, Cititrust Holdings Plc, has also disclosed its decision to complete the recapitalization of the bank from a Regional Mortgage Bank to a National Mortgage Bank before the end of first quarter of 2021.

Another early indication that Cititrust Holdings has very lofty plans for the bank was the appointment of seasoned banker, Mr. Adekunle Adewole, as Managing Director, to head a new management team comprising other experienced bankers and financial experts.

The new Managing Director is a banking professional with over two decades of experience cutting across retail, commercial, corporate banking, corporate strategies, and credit risk management. He served in various positions in Omega Bank (now Keystone Bank), Standard Trust Bank (now UBA), Broad Bank (now Union bank), and Sterling Bank.

He holds two MBAs in Marketing and Finance from the University of Ado-Ekiti and the Metropolitan School of Business and Management, UK. He also holds a Masters in Business Law, a Masters of Philosophy with specialization in Strategic Management, and a Certificate in Global Management (CGM). He is an Alumnus of Lagos Business School and INSEAD.

The bank’s board of directors was also reconstituted to accommodate proven technocrats and accomplished administrators, thus, bringing on board Mr. Yemi Adefisan, Group Chief Executive of Cititrust Holdings Plc, as a non- executive director. Others include Mr. Olufemi Adesina, Mr. Bola Oyebamiji, Mr. Mike Omolaja, Prince Adeniran Adewole, non-executive directors and Mrs. Fehintola Ibidunni Olatunde-Agbeja, independent director. Alhaji Adebayo Jimoh was retained as board chairman.

Adefisan, as Group Chief Executive of Cititrust Holdings Plc, has successfully grown the group to becoming one of Africa’s leading financial and investment services companies with diverse business portfolios and a balance sheet of over N44 billion with 358 employees and over 1,000 indirect employees as of September, 2020.

Currently, the company has carried out 12 successful acquisitions across Nigeria, Ghana, Benin Republic and Rwanda and has invested a total of N11.4 billion in its subsidiaries as capitalization.

The bank’s chairman, Jimoh, served as Executive Director in charge of group operations of John Holt PLC from 2003 till he was appointed Group Managing Director/CEO of Odua Investment Company Ltd, in May, 2005. He served in that capacity till October 2014. He has also sat on the board of several companies, including Lafarge Africa Plc.

Other milestones achieved by the bank within the short period of its acquisition by Cititrust Holdings include the approval it secured to migrate from the Alternative Securities Market (ASeM) Board to the Standard Segment of the Growth Board of the Nigerian Stock Exchange on October 23, 2020.

With the development, the bank is now poised to migrate to the main board of the NSE by first quarter of 2021 and also take advantage of the FMDQ OTC Securities Exchange to tap the enormous opportunities in the Debt and Equity Capital market.

Also, on November 16, 2020, the Development Bank of Nigeria (DBN) granted approval to the bank as a Participating Financial Institution. LivingTrust Mortgage Bank Plc was one of the few banks that scaled DBN’s qualification criteria, based on a strong balance sheet, board/management profile and sound corporate governance practices. This approval grants the bank access to a minimum of N953, 591, OOO for on-lending to prequalified MSMEs and Small Corporates.

As part of its corporate renewal strategy, the bank recently launched an array of products to meet the growing needs of its customers at home and abroad.

Speaking at the product launch, the managing director,  said, “We have added more features to some of our existing products, and launched new ones to meet the growing needs and sophistication of our customers. We shall continue to leverage technology to provide solutions that deliver a wow experience to our customers using a multichannel approach.”

“The deployment of four new ATMs at different locations within our business areas to compliment the existing six, and the launch of our mobile app, TRUSTMOBILE, is to make banking convenient and seamless for our customers in Nigeria and abroad,” he added.

The bank has also been involved in a number of Corporate Social Responsibility initiatives, especially within its host communities. Of particular note is the letter of commendation personally written to the bank by the Osun State governor for its support in the fight against COVID-19.

The letter dated August 6, 2020 and personally signed by the governor, reads in part: “It will be placed on record that your contribution has really gone a long way in assisting the 21-Man Osun State COVID-19 Committee, which was set up to cushion the effect of the lockdown and restriction of movements placed on citizens across the state occasioned by the pandemic, achieve its set objectives. Your kind gesture has given us hope that we can rise above all odds towards advancing our development as a people in the face of daunting challenges.”

In the final analysis, Governor Oyetola’s decision to cede 60 percent ownership of the bank to Cititrust Holdings Plc has yet again vindicated the time tested entrepreneurial code that it is better to be part owner of a thriving business than full owner of a struggling or dying one. And the bank’s customers and investors, as well as the people of Osun State, are going to be the better for it.

*Ladigbolu is a Lagos-based journalist