NEXIM Bank Bags Best Performing African DFI

The Association of African Development Finance Institutions (AADFI) has rated the Nigerian Export-Import Bank (NEXIM) as ‘Best Performing African DFI.’

The decision was an outcome of  the ‘2013 Annual AADFI CEOs Forum of African Development Banks and Finance Institutions’ on the theme "Strengthening African DFIs with Appropriate Standards and Guidelines: 3rd Peer Review & Rating of African DFIs" held at Kenya on  November, 2013.

The Forum marked the conduct of the 3rd Peer Review of DFIs with the AADFI Prudential Standards, Guidelines and Rating System (PSGRS).

In the letter conveying the message to NEXIM Bank, titled “CONGRATULATION ON YOUR RATING AS BEST PERFORMING AFRICAN DFI”, Mr. J.A. Amihere, secretary general of AADFI, stated, “In the light of your institution’s rating as ‘Best Performing DFI”, we are pleased, on behalf of the Chairman of the Association, to extend our warm congratulations to your Board of Directors and Management Team on this record performance, and urge you not to relent in your effort at entrenching best practices in the operations of your institution as you continue to sustain your development financing mandate.”

According to AADFI, the Peer Review Exercise with the AADFI PSGRS was not a competition but an approach to evaluate DFIs in the various areas of governance, finance and operation in order to identify areas of weaknesses for self-improvement and strengths for consolidation.

Suffice to state that considering NEXIM Bank was in the ‘Negative rating’ for a long time before the Roberts Orya-led Management took office in August 2009, it is instructive to note that it quickly moved to ‘B’ rating in 2012, then progressed to ‘Best Performing African DFI’ in 2013.

The state of affairs of NEXIM at the time Mr. Roberts Orya took charge of the then newly-constituted Executive Management on August 20, 2009 was such that the financial and operational performance of the Bank had deteriorated to a punching level, in addition to a myriad of other problems.

These extended to an alarming decline in the quality of risk assets as the Bank’s total loan portfolio of N14.6 Billion was non-performing by 72%. Within that category, N10.03 Billion or 69.05% was classified as completely lost resulting in a decline in the bank’s income.

The net effect was a depletion of the Bank’s shareholders funds as a result of accumulated losses, significant decrease in income and tolerance of excessive and escalating overheads. Coupled with these were the issues of non-adherence to corporate governance tenets, non-existent risk management framework, lack of strategic focus and digression from core mandate, lack of visibility of the Bank, etc.

In light of the above, the Executive Team set to reverse the problems and ensure NEXIM Bank was able to contribute significantly to the economic development of Nigeria.

Under the leadership of  Dr. Kingsley C. Moghalu, former board chairman, the Management received approval in 2010 to reposition the Bank to effectively deliver on its statutory mandate and become an ‘effective enabler of Nigeria’ economic transformation.

Accordingly, a Corporate Transformation exercise was initiated centering on the key perspectives of Strategy, Risk Management and Corporate Governance, Financial Performance, Operations, Organization and People, with assistance from KPMG Professional Services.

The outcome of the exercise was the Corporate Transformation Project (Project Spring) which led to the re-definition of the Bank’s Mission, Vision and Strategic Objectives targeting four sectors, namely, Manufacturing, Agro-processing, Solid Minerals & Services, which have high employment and foreign exchange earning potentials in the non-oil sector of the Nigerian economy. This has become the MASS Agenda of the NEXIM Bank.