Wema Bank Plc has released its financial statement of the last two years, which the bank said was a reflection of the challenging period it faced.
The statement showed that although gross earnings increased by 82 per cent to N23.683 billion, the increase was not reflected in the net result because of additional provisions of N36 billion.
The bank said the release of these results marked a fulfilment of the new management’s commitment to transparency, adherence to regulations and sound corporate governance practices.
The new management stated that the previous challenges faced by the bank have impacted adversely on its business, as evidenced by the weak financial performance reported in its published accounts. A major challenge for the bank is the quantum of non-performing loans and advances in the sum of N116.355 billion which have been provided for in the accounts and led to erosion of the capital base.
The issues the bank faced during this period led to the appointment of an interim management board by the Central Bank of Nigeria (CBN) to oversee the operations of the bank.
After 18 months, the interim board handed over responsibility of the bank to the current management team led by Segun Oloketuyi on June 10, 2009.
“However, in this challenge lies our greatest opportunity to recapitalise the bank through the bold initiatives that the board and management have taken to recover these non-performing loans,” the bank stated.
“We are pleased by the result achieved so far. A significant amount of recoveries have been made post September 30, 2009 balance sheet date. These recoveries will improve the shareholders funds when our accounts are published for the year ending December 31, 2009.
“Furthermore, the new board and management have articulated and commenced the implementation of a three-phase turnaround programme to restore the bank as a leading financial institution in Nigeria. A critical phase in the transformation process is the need to strengthen the capital base of the bank in line with regulatory requirements and we have put in place a recapitalisation programme that will achieve this objective within the first quarter of 2010.
“The support of the CBN in this turnaround programme has been invaluable, especially the recent injection of funds into the bank. Given our financial performance in the last couple of months, we are emboldened to confirm that the bank is on the road to recording stronger results in the future,” it stated.