Olabisi Onabanjo University Microfinance Bank Limited (OOUMFB) has reassured its shareholders and customers of improved revenue generation and profitability level in the next fiscal year. This came as the Bank posted a profit before tax of N2.129million for the financial year ended December 31, 2020 and also had its shareholders fund increased to N117, 785million in the year under review.
At the 14th Annual General Meeting (AGM) of the Bank held on November 24, 2021 at the OGD Hall, Main Campus, Olabisi Onabanjo University (OOU), Ago-Iwoye, the Bank declared its readiness to exploit the emerging business opportunities in and around its operating environment.
However, due to the impact of the coronavirus pandemic and industrial action embarked upon by the Academic Staff Union of Universities (ASUU) members earlier in the 2020 financial year, the Bank disclosed that dividend payments to shareholders were deferred till the next AGM.
Presenting the performance of the Bank, the Chairman of the Board, who is also the Vice-Chancellor, Olabisi Onabanjo University (OOU), Ago-Iwoye, Professor Ganiyu Olatunji Olatunde, said the year 2020 was challenging due to the COVID-19 pandemic which disrupted economic activities nationwide. The Vice-Chancellor, who was represented by the Bursar, Mr Semiu Makinde, added that the industrial action by ASUU which crippled academic activities within the University campus and its environs also compounded the economic woes of the Microfinance Bank.
According to him, the Bank’s posted profit before tax of N2.129million for 2020 financial year showed a decrease of N10.139million when compared to N12.3million recorded in 2019. He explained that loans and advances to customers also reduced from N109.815million in 2019 to N81.877million in 2020.
In spite of the negative indices, the Board Chairman noted that the Bank’s shareholders fund increased from N115,702million in 2019 to N117,785million in the year under review. He expressed optimism that the Bank will continue to move to greater heights in subsequent years.
On human resources, Prof. Olatunde posited that the Bank had continued to lay strong emphasis on staff welfare, stressing that the system provides an enabling environment that encourages good interpersonal relationships, team spirit, good initiatives, self-confidence, creativity and self-development at work.
He said, “Staff development is a top priority in our bank. Management and staff are allowed to attend seminars and courses most especially those organised by the Central Bank of Nigeria (CBN) and other training institutions to ensure innovation, efficiency and increased output.
Staff members are encouraged to upgrade themselves academically in areas recognised in industry and commerce to enhance their effectiveness.”
He thanked customers, business partners, shareholders and regulators, among others, for their invaluable contributions to improve and strengthen the operations of the microfinance bank.
Prof. Olatunde added, “In our drive to broaden our revenue base and profitability level, we have adopted a holistic approach towards our local market development penetration.
“We are optimistic that our effective business networking approach to shareholders within the community and outside the community also added value to our business interest and will continue to help us in the development, penetration of new markets and the dream to make our Bank a state Microfinance Bank. We shall continue to improve and strengthen our operations, such that the Bank remains the number one source of value to all who regularly interact with it.
While addressing the shareholders, the Managing Director, Mr Peter Ogunlolu, decried the impact of COVID-19 pandemic and associated lockdown as well as the ASUU industrial action which, according to him, compounded the already bad situation.
Ogunlolu, who presented the Chief Executive’s Review, noted that the past year presented some challenges to the Bank and its customers, employees and communities against the backdrop of the ongoing global pandemic that led to a widespread economic crisis.
Based on the foregoing financial performance highlights, he disclosed that the Bank’s interest income reduced from N70.865million in 2019 to N49.83million in 2020.
He added, “In the same vein, total operating expenses reduced from N51.377million in 2019 to N45.001million in year 2020 while interest expenses reduced from N60.032million in year 2019 to N36.765million in year 2020.”
“Deposit liabilities reduced from N378.221million in year 2019 to N215.416million in year 2020 while loans and advances to customers also reduced from N109.815million in year 2019 to N81.877million in year 2020. However, in spite of the negative indices, the Bank’s shareholders fund or total equity increased from N115.702million in 2019 to N117.785million in 2020.”
Ogunlolu, who pointed out the economic environment will remain challenging in 2021 as a fallout of the COVID-19 pandemic, however, assured that the Bank would focus on strategic priorities to deliver its overall business goals.
“Our key objective is to enhance shareholders/stakeholders value by exploring business opportunities both within and outside the University Community; leveraging on the advancement in internet banking platform to achieve strategic growth and profitability; driving service quality and efficiency in our operations; ensuring a sustainable growth and financial intermediation and ensuring that all members of the University Community are in account relationship with OOU Microfinance Bank,” he said.
While thanking the Board, Management and staff of the Bank, the Managing Director enthused that he had no doubt that the Bank shall be in a better financial position to deliver handsome returns on investments to shareholders by the end of the current financial year.
Giving the independent auditor’s report at the meeting, Benjamin Akanji Omonayajo & Co. (Chartered Accountants) said the financial statements, comprising the statements of financial position as at December 31, 2020 and the statement of profit or loss and other comprehensive income, statement of changes in equity and statement of cash flows of the Bank had been audited.
“In our opinion, the accompanying financial statements give a true and fair view of the financial position of OOU Microfinance Bank Limited as at 31 December, 2020, and the financial performance and cash flows for the year then ended in accordance with International Financial Reporting Standards, the Banks and Other Financial Institutions Act CAPB3 LFN 2004, the regulatory and supervisory framework for Microfinance Banks, the Companies and Allied Matters Act 2020 and the Financial Reporting Council of Nigeria Act, 2011,” the auditor’s report read.
