The origin of banking in Nigeria dates back to the colonial era. In 1892, the African Banking Corporation (ABC) was founded in Britain by Elder Dempster and Company Ltd, a Liverpool-based shipping agent.
The ABC, entirely owned and operated by foreigners, was the first bank established in Nigeria. It was soon followed by other banks, beginning with the Bank of British West Africa (BBWA) in 1894, which eventually acquired the African Banking Corporation.
The Anglo-Africa Bank Ltd, Nigeria’s first indigenous bank, and the Colonial Bank were founded in 1902 and 1917, respectively. Subsequently, establishing banks became more straightforward and frequent, with 94 of 145 banks being founded between 1945 and 1952 by both local and foreign investors, marking the era of unregulated banking.
The proliferation of banks, many lacking solid financial foundations and competent management, led to frequent financial distress, partly due to the absence of regulation. The 1952 ‘Banking Ordinance’ was Nigeria’s first attempt to regulate banking activities, ushering in the era of regulated banking.
The banking industry in Nigeria has since gone through several significant or transformational phases, including the Era of Free Banking (1892-1952), the Period of Regulated Banking (1952-1986), the Era of Deregulation (1986-2004), and the Era of Banking Consolidation combined with the Era of Stringent Banking Regulation (2009-2015). 2015 till date as seen the industry change at rapid speed but can broadly be defined as the era of financial inclusion, retail expansion, digitalisation, and corporate responsibility.
Despite various regulatory reforms aimed at improving the banking sector, Nigeria faced severe banking crises in the 1990s. In response, significant measures such as increasing the capital base of commercial banks from ₦2 billion to ₦25 billion in 2005 and implementing strict banking regulations in 2009 were introduced.
These milestones were pivotal in shaping the Nigerian banking system. Nevertheless, one of the banks that evolved from this crisis, has today become a behemoth, with its sights set on becoming the world’s most respected African bank.
Access Bank began its operations in May 1989 after obtaining a banking licence from the Central Bank of Nigeria. Initially, it faced challenges as a small player in the Nigerian banking sector. By 2002, when Aigboje Aig-Imoukhuede and Herbert Wigwe took over, Access Bank was ranked 65th out of 89 banks in Nigeria.
The resilience of Access Bank is evident in its early challenges, as between 1989 and 2001, the bank experienced limited growth, operating only 27 branches in 14 years. Its financial performance was also poor, providing minimal returns to investors. Despite these early struggles, the new leadership was determined to turn the tide.
The turning point came in 2002 when Aig-Imoukhuede and Wigwe implemented an ambitious transformation agenda. First, they assembled a formidable management team with a mandate to reengineer and refocus the bank. This marked the beginning of a strategic transformation aimed at elevating Access Bank to a top industry position.
In March 2002, the Board of Directors appointed Aig-Imoukhuede as Managing Director/Chief Executive Officer and Herbert Wigwe as Deputy Managing Director. The mandate was clear: Reposition the bank as one of Nigeria’s leading financial institutions within a five-year period (March 2002 to March 2007). This task was perceived by many as impossible given the realities of the Bank at the time.
The new management team subsequently created a transformational agenda for Access Bank which represented a departure from all that characterised the Bank in the past and became the road map for the conversion of the lender into a world class financial institution.
The impact of the transformation agenda was reflected in the first year. The bank grew its balance sheet by 100% and posted an impressive N1 billion profit-before-tax (PBT). Though paling in comparison to the numbers it reports today, the PBT was more than the cumulative profit made by the bank in the previous 12 years.
This also marked the beginning of what would be a six-year record triple-digit growth trend. Similarly, earnings per share had rebounded to 21 kobo from a negative 2 kobo position, leading to a declaration of a 5 kobo dividend to shareholders for the first time in three years.
Access Bank also expanded its banking portfolio, leveraging relationships with large corporate clients to drive organic growth. Strategic acquisitions also played a crucial role in this transformation, as in 2005, Access Bank acquired Marina International Bank Ltd and Capital Bank Ltd (formerly commercial bank Crédit Lyonnais Nigeria).
In recognition of the role of an enhanced capital structure, the bank embarked on a capital raising exercise in July 2007. The exercise was an astounding success recording more than 300 per cent in over subscription.
The public offer comprised of an Over-The-Counter GDR placement of US$250 million which was similarly oversubscribed by 700 per cent. The bank’s shareholders fund today stands at over N2.5 trillion with a shareholder base of over 920,000 domestic and foreign investors.
In 2011, Access Bank acquired Intercontinental Bank, significantly expanding its customer base and asset portfolio.
By 2019, the merger with Diamond Bank created one of the largest banks in Africa by assets and customer base, strengthening its retail banking presence and digital banking capabilities.
Access Bank’s transformation has not only been about growth, but also about setting a benchmark in the banking sector. The bank has been at the forefront of digital innovation, launching various digital banking products and services to enhance customer experience and financial inclusion.
Its mobile banking app has made banking services more accessible to millions of customers, particularly in rural areas, contributing significantly to financial inclusion.
Expanding its footprint across the African continent, Access Bank now operates in 22 countries. Its African spread includes a presence in Angola, Botswana, Cameroon, Congo DR, Gambia, Ghana, Guinea, Kenya, Mozambique, Nigeria, Rwanda, Sierra Leone, South Africa, and Zambia.
This pan-African strategy leverages the bank’s capabilities in trade finance and digitalisation to serve as a gateway between Africa and the rest of the world. Access Bank also has operational presence in key financial centres such as China, Hong Kong, France, UAE, and the UK, and maximises this to facilitate international trade and investment.
The bank’s resilience and transformative strategies have translated into robust financial performance and industry recognition.
Over the years, Access Bank has consistently reported growth in revenue, profit, and assets. It is now firmly recognised as one of the leading financial institutions in Africa, receiving numerous awards and accolades for its banking services, innovation, corporate governance, and social responsibility efforts.
Commencing in the second half of 2024, the Bank’s Africa and international expansion strategy will enter the consolidation and efficiency phase, aligning with its plan to become a top-five bank in Africa by 2027.
Looking ahead, Access Bank plans to continue its expansion across Africa and other international markets, seeking opportunities for growth and innovation. The bank aims to further enhance its digital banking capabilities, focusing on customer-centric solutions and leveraging emerging technologies.
Written by Joseph Yeduma, a financial analyst.
