The Nigerian banking sector has witnessed a concerning rise in fraudulent activities, with incidents of fraud in bank branches increasing by 31 percent in the second quarter of 2024.

This alarming statistic was disclosed by the Financial Institutions Training Centre (FITC) in its Fraud and Forgeries report, highlighting significant challenges to the integrity of the country’s financial system.

Fraudulent activities in Nigerian banks led to a staggering N42.33 billion in reported losses during the first half of 2024.

This sharp rise was driven by escalating fraud across multiple channels, most notably within physical bank branches.

The FITC report revealed that fraud in bank branches rose dramatically to N42.2 billion in the second quarter, compared to N133.9 million in the first quarter.

The FITC data also pointed to a massive 1,560.3 percent increase in computer and web fraud. Losses in this category surged from N24 million in the first quarter to N400.8 million in the second quarter.

In contrast, mobile fraud witnessed a significant decline, dropping by 59 percent from N216.4 million in the first quarter to N88.7 million in the second quarter.

Interestingly, no cases of ATM-related fraud were recorded during the period under review.

The figures also indicate a shift in fraudulent activities involving various financial instruments. Card fraud saw a notable decline of 47.66 percent, with cases dropping from 21,469 in the first quarter to 11,231 in the second quarter. Conversely, cheque-related fraud rose by 36.67 percent, increasing from 30 cases in the first quarter to 41 in the second quarter.

Mobile fraud recorded an even steeper decline in value terms, dropping by 99 percent from N21.6 billion in the first quarter to N216.36 million in the second quarter.

These figures suggest evolving strategies among fraudsters, with some methods becoming less prevalent while others gain traction.

Amid the rising tide of fraud, legal actions have also intensified. In one notable case, an Abuja Federal High Court issued a 30-day freeze on 818 bank accounts linked to a N10 billion cyberattack on a Nigerian bank.

The court’s directive, issued on October 15, 2024, was based on a motion filed by the police against James Akagwu Isaac and other suspects, including several financial institutions.

Analysts say the surge in fraudulent activities underscores the urgent need for heightened vigilance, enhanced security measures, and robust regulatory interventions in Nigeria’s banking sector.

While the decline in some fraud categories, such as mobile and card fraud, offers a glimmer of hope, the sharp rise in branch-based and web-related fraud highlights the evolving tactics of fraudsters.

To combat these threats effectively, experts recommend that banks must invest in advanced fraud detection systems, conduct regular staff training, and strengthen internal controls.

Collaboration between financial institutions, law enforcement agencies, and regulators will also be crucial in mitigating the impact of fraud and safeguarding the financial ecosystem.

The FITC report serves as a stark reminder of the vulnerabilities within the banking sector and the need for proactive measures to address them. Without sustained efforts, the rising trend of fraud could pose significant risks to Nigeria’s economic stability and the trust of consumers in the financial system.

Credit: Tribune

United Bank for Africa (UBA) Plc said it will utilise the net proceeds of its ongoing N239.4 billion rights issue to invest in additional digital technologies and business expansions that will strengthen the bank’s seven and half decades of impressive performance.

Tony Elumelu, group chairman, UBA,

UBA is offering 6.84 billion ordinary shares of 50 kobo each to existing shareholders at N35 per share. The rights issue is pre-allotted on the basis of one new ordinary share of 50 kobo each to every five ordinary shares held as at November 05, 2024.

The rights issue is scheduled to close on December 24, 2024.

Tony Elumelu, group chairman, UBA, said the primary objective of the ongoing rights issue is to strengthen the bank’s position as a pan-African banking industry leader and a highly rewarding institution for all stakeholders.

He said the group decided on the rights issue to ensure that shareholders continue to derive undiluted benefits from a stronger, more innovative and resilient pan-African banking group.

Elumelu said the rights issue would enable the bank to drive organic expansion and business growth within and outside Nigeria, while strengthening its international operations, adding that UBA recently signed an agreement to commence full banking operations in France.

According to him, with presence in key global financial hubs including the United Kingdom (UK), United States of America (USA), France and United Arab Emirates (UAE), the bank would deepen its global operations by investing more in these global markets and further extend its global reach.

He noted that, “With African subsidiaries contributing more than 50 per cent of the group’s overall performance, the bank would also make additional investments in existing African operations while exploring new opportunities. UBA currently has operations in 19 African countries outside of Nigeria.”

He pointed out that the bank’s expansion plan is driven by its philosophy of developing African businesses, noting that UBA is not only expanding its geographical reach, but also playing a strategic and pivotal role in the economic transformation of Africa as a continent.

He added that while the rights issue would enable the bank to meet the new capital requirements stipulated by the Central Bank of Nigeria (CBN), the net proceeds would put the bank in a better stead to expand lending to small and medium enterprises (SMEs).

He outlined that the bank would make substantial additional investments in technologies to consolidate its reputation as a cutting-edge financial services group and deliver a more robust customer experience.

To him, new investments in information and communication technology (ICT) would further strengthen the group’s digitisation and operational efficiency, thus fostering improving coordination and synchronisation amongst the various entities and delivering improved service delivery and customer satisfaction.

UBA said it plans to strengthen collaboration and partnership with TELCOs and FinTechs to drive technology-enabled initiatives across Africa that will improve intra-trade, remittances, and payments across Africa.

The bank added that it plans to broaden its payment capabilities to enable it to transform the way merchants collect payments by offering solutions that offer seamless, secure and user-friendly ways of managing and consummating transactions.

Elumelu reiterated the bank’s long-term strategy of becoming the undisputed leading and dominant financial services institution in Africa, with greater emphasis on Nigeria.

Jaiz Bank has successfully listed the N10.04 billion proceeds from its private placement on the Nigerian Exchange Group (NGX), following regulatory approvals by   the Central Bank of Nigeria (CBN), Securities and Exchange Commission (SEC).

This places the bank among the few banks that have already met the new capital requirements of the CBN, ahead of the June 2026 deadline.

The bank in a statement yesterday indicated that its financial position remained robust, with a well-structured, diversified, and resilient balance sheet.

“Total assets currently stand at ¦ 1.06 trillion, while shareholders’ funds have reached ¦ 47.9 billion,” it said.

Speaking on the successful capital-raising exercise, the Chief Executive Officer of the bank, Dr. Haruna Musa, “This achievement underscores the commitment of the board and management to adding value to our customers by providing bespoke ethical finance solutions.

“Jaiz Bank is well-positioned to compete effectively on all fronts, fulfilling customer needs through ethical and innovative financing. Despite a challenging operating environment, we have demonstrated resilience and achieved remarkable growth across financial and non-financial metrics. This positions us firmly on track to becoming the leading ethical bank in Africa.”

He emphasized the bank’s strategic focus, saying: “Looking ahead, we will continue strengthening relationships with our loyal customers while attracting new ones.

“Through our digital platforms, innovative products, and services, we aim to support individuals, businesses, and communities alike. Our journey to lead the future of ethical finance in Africa remains unwavering, as we stay committed to excellence and delivering long-term value to all stakeholders.”

Jaiz Bank’s performance metrics highlight its exceptional growth and operational efficiency. Key financial ratios include a Return on Equity (ROE) of 60.74% and a Return on Assets (ROA) of 2.18%.

The achievement reinforces Jaiz Bank’s position as a leader in ethical banking, further solidifying its commitment to providing innovative financial solutions  to its customers.