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COMPETITIVE ADVANTAGE OF MULTIDIMENSIONAL KNOWLEDGE ACQUISITION IN THE NIGERIAN BANKING INDUSTRY

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ABSTRACT

The study is on competitive advantage of multidimensional knowledge acquisition in Nigerian banking industry. The  theoretical frameworks for the study are  value-based management strategy, blue ocean management strategy and business intelligent approaches. The objectives of the study are: to ascertain the extent to which the level of improvement in international standard performance rating of Nigerian banks is enhanced by multidimensional acquisition of banking knowledge; to determine whether acquisition of diversified banking knowledge is compatible with the quality of services Nigerian banks offer to the satisfaction of customers; to  evaluate  the  impact  of  adequate  multidimensional knowledge acquisition on  financial strength, robustness and competitiveness of a bank; to determine the rate of commercial banks financial contribution to industrial sector growth in Nigeria through diversified knowledge acquisition in banking; to determine the extent to which financial support of Nigerian banks to commercialization of agricultural sector of Nigerian economy is enhanced by acquisition of multidimensional knowledge in banking; and to determine the degree to which the social development services of the Nigerian banking firms can be facilitated by the acquisition of multidimensional banking  knowledge.  The  research  design  for  the  study  is  longitudinal survey. The population of the study is one thousand and forty five (1045) staff of the selected banks (Zenith bank, First bank and Oceanic bank) in Imo, Rivers and Enugu States. The sample  size  of  six  hundred  (600)  was  drawn  from the  study  population using Cochran Systematic Sampling. Data were obtained from primary and secondary sources. The research instrument was subject to content validity. For reliability of the research instrument, a test- retest method was adopted using Pearson’s Correlation Coefficient and the calculated result gave reliability coefficient of 0.81. Six hypotheses were proposed and tested using simple percentage analysis and regression analysis. The findings reveal that the level of improvement in international bank standard performance rating is greatly enhanced by multidimensional knowledge acquisition among Nigerian banks, diversified knowledge acquisition in banking is not compatible with the services provided to the satisfaction of Nigerian banks’ customers, adequate knowledge acquisition has positive impact on financial strength, robustness and competitiveness in Nigerian banking industry, acquisition of diversified banking knowledge in Nigerian banks has significant rate of financial support in Nigerian industrial sector growth

and development, the level of financial support of Nigerian banks to commercialization of agricultural   sector   of   Nigerian   economy   is   greatly   enhanced   by   acquisition   of multidimensional knowledge in banking and social infrastructural development services of Nigerian banking firms is greatly facilitated by the  multidimensional banking knowledge acquired by Nigerian banks. The study recommends the following: Nigerian banks should exploit the wealth of international accepted best practices banking knowledge; Nigeria banks should upgrade their multidimensional banking knowledge acquisition in order to improve on the  quality and quantity of customer service segmentation; Nigerian banks should acquire vast knowledge in international best practices banking in order to impact positively on financial strength, robustness and   competitiveness; Central Bank of Nigeria should come up with policies that will encourage and mandate Nigeria banks to contribute massively in  funding industrial  development  and  growth  in  Nigeria;  proper  funding  of  agricultural commercialization by Nigerian banks is recommended to ensure food security sustainability,

job creation and industrial raw material production.

CHAPTER ONE INTRODUCTION

1.1     BACKGROUND OF THE STUDY

Multidimensional knowledge acquisition in banking is the portfolio of diversified competencies and skills needed for effective and timely banking services and operations obtainable in international standard best practices in banking. According to Uzor (2010), one of the Central Bank of Nigeria

(CBN) guideline policies to commercial banks in Nigeria is adoption of the International Financial Reporting Standard (IFRS) latest December 2010. The CBN is so adjourning Nigeria Commercial Banks to adopt broad knowledge in international accepted best practices in banking. The portfolio of  competencies and  skills  in  banking beside  time  and  savings  deposit routine services include the knowledge of banking as financial partner in progress with the government towards nation building and development of economic sectors like agricultural sector, industrial sector, education sector infrastructural development,  and  job  creation  through  loan  financing  or good–will competitive gesture. Because banks are the  medium to effect desirable changes in the real sectors, it is important for the Central Bank of Nigeria to show how its policy changes will stimulate economic growth and development across sectors and industries (Uzor, 2010). The need for changes in the banking sector which is a service industry ought to be driven by discovery of new opportunities in the banking sector that are not warranted by new developments in a number of sectors in the real economy are not going to be much beneficial (Uzor, 2010). Banks are servants to the nation economy (Uzor, 2010).

Keke (2010) quoted Monetary Credit Foreign Trade and Exchange Policy guidelines for fiscal years 2010/2011 say, “The banks should continue to pursue its developmental role vigorously in 2010/2011 fiscal year by supporting specific programs/projects in  view  of  the  persistent demand- supply gap in financing the real sectors (example agricultural sector). Improving access to finance by Micro, Small and Medium Enterprises (SMES) is necessary to generate employment and moderate inflation”. Monetary policy circular number 38 2010 edited banks infrastructural finance. Infrastructural development remains grossly inadequate relative to

the  nation’s requirement due to lack of funds. To  improve financing of infrastructure development, the bank shall in 2010/2011 fiscal year in collaboration with stakeholders launch an infrastructural finance policy and development strategy to support the country’s development as well as make Nigeria attractive to the private sector and foreign direct investment. There is gross capacity under-utilization in bank portfolio of services and activities as have been offered by Nigerian banks since 1999-2009 compared with some international giant banks in both developed and developing countries of the world.   Using break-even point analysis or profit and loss analysis (which is an economic analytical technique used to study the relationship between the total costs, total revenues and total profit or loss over the whole range of stipulated output level) to analyze the capacity utilization efficiency of Nigerian banks. Nigerian banking industry is discovered to be operating on financial benefit and not on wealth creation and economy development value based. The strength of Nigerian banking industry has been on short term or immediate financial return of extant services on time, demand and savings  deposits.  The  wealth  creation  services  like  sectoral  economic projects such as commercial agricultural projects financing, industrial development financing (micro, small, medium and large enterprises); youths development support schemes (like youths financial empowerment and training initiatives, youth facilitation and awareness programme on skills opportunities  and  acquisition which  will  add  value  to  human  –  capital development and societal development) Health developmental projects like provision of clean drinking water such as borehole water projects or schemes which is a goodwill competitive advantage issue. Support scholarship education projects for the indigent or active poor families children and thus

reducing their societal insecurity risk of being crime operators like armed robbery, kidnapping, assassination and ritual killing;

The zone for maximum benefits through time, demand and savings deposits occupies  the  benefits  banks  derived  from  fixed  deposits,  currents  and savings account deposits. This zone is within – capacities underutilization of bank facilities, manpower, and materials. This zone is also known as red ocean zone with so much competition, and low competitive values. This is the zone where many banks are scrambling for few society wealthy individuals or corporate bodies to open account mainly fixed deposits in their respective bank. This zone has immediate or short – term benefits.

It is also a zone of very poor leadership and management team with less vision,  low  creativity, weakness  in  business  adventure, poor  innovative mind, lack of multidimensional knowledge portfolio in banking services, operations  and  activities.  The  unsaturated  blue  ocean  zone  of  wealth creation embodies banking services and activities tailored to wealth duplication and high long–run/continuous projects and multiple benefits. Multidimensional knowledge  in  banking  portfolio  in  this  zone  include sectoral developmental projects like various commercial agricultural projects,  industrial  development  financing  like  cottage,  micro,  small, medium even large scale industries. These projects create employment wealth or money benefit which will also go back to the banks as time/and demand and savings deposits, empowers the idle youths and also reduce the rate of bank armed-rubbery and bankers kidnapping cases.

The social responsibility or goodwill gesture of this zone like provision of clean  drinking  water,  clinics  and  health  facilities,  school  facilities  and

education  scholarship  opportunities  for  the  active  poor  families  in  the society will create a friendly environment of operation and service to the banks  in  Nigeria  society.  Multidimensional  knowledge  acquisition  in banking  embraces  the  full  capacity  banking  knowledge  or  portfolio  of competencies and skills in banking in the two zones (Zone A and B) in the non-linear breakeven points model in figure 2.1 in chapter two. Giant or big international reputable banks are operating in this full capacity utilization. Value-Based   Management   (VBM)   Concept,   Red   and   Blue   Ocean Management   Strategy   and   Business   Intelligence   Approach   are   the management theoretical frameworks or philosophies on which this study anchored.

Value-Based Management Concept: Value-Based Management is the approach  that  ensures  that  organizations  are  run  consistently  on  value (Alabi, 2010). Value-Based Management usually seeks to maximize shareholders’ value always and every time. It consists of three major components: creating value strategy, managing for value (through corporate governance,  change  management,  organizational culture,  communication and leadership), measuring value (valuation).

The reason for Value Management is that Value becomes imperative in managing because of its many and wide-ranging effects. Some of these wide-ranging  effects  of  value  management  are  provision  of  returns  or profits, productivity enhancement, growth accelerations, innovativeness, knowledge enlargement or increase and diversification of services, operations, and cooperation portfolio. Management for value requires that values must first be created, before it can be appropriately managed. Value- Based Management shoulders on  value-based innovation and  leadership

style of the operators. Blue Ocean Strategy (BOS) is as stated by Kim and Mauborgne (2005) a management strategy which align business or organization environment to blue nature of an ocean which is a state of many untapped opportunities, unsaturated activities and innovative/creative opportunities.

The Blue Ocean Strategy illustrates the high growth and profits an organization  can  generate  by  creating  new  demands  in  an  uncontested market space or a “Blue Ocean”, than by competing head – to – head with other competitors for known customers in an existing industry “Red Ocean”.

Blue ocean strategy – Kim and Mauborgue (2005) say, “If an organization is already  in  red  ocean,  that  is  a  business  situation where  almost  all  the competitors share good knowledge of the competitive games, a firm can cross over to the blue ocean where competitive games are unknown and where there is no competitors to be battling with by observing these six paths:

Look across alternate industries, look  across strategic groups within the industry, look across chain of buyers, look across complementary products and service offerings, look across functional or emotional appeal to buyers, look across time (Kim and Mauborgne (2005).

According to Goran (2006) Business Intelligence (BI) is an approach to Key Business Factors (KBF) in the banking industry. Goran Radonic stressed that, “banks operate in one of the most dynamic environments: new markets are being opened, new products are being launched, new competitors enter market that were previously reserved only for banks, new regulatory requirements are being imposed, and new customer needs are being identified.  Rapid  external  changes  and  high  pressures  affect  banking

operators with immediate impact on development of banking Information Technology (IT) system. Continues innovation and launch of new products with ever shortened life cycle has led to development of many non or loosely connected  applications  making  banks  IT  a  heterogeneous  collection  of system and  data”.  The  Banking  industry is,  and  will  be  more  oriented towards the selling of new products that will impact rapid economic development  and   growth  on   its   business  environment  than  towards traditional services such as holding deposits and offering of high interest loans.  That  makes a  modern bank’s employee more a  salesman than a traditional banker. Armed with a timely and accurate information, a modern banker knows all about his or her customer and all the banker’s services that would be appealing to that particular customer, as well as the profitable and risk-acceptable for the bank. Girish (2001) stressed that, “Having a strategy to leverage modern information technology to gain an operation efficiency, enhance customer service, raise productivity and profitability, the banking industry is becoming less focused on its core business of holding deposits and giving loans, and more on managing information.

From the theoretical base points of this study especially with reference to Value-Based Management Concept, Blue Ocean Management Strategy and Business Intelligence Approaches in banking, also synchronizing these theoretical framework with New Model banking of Central Bank of Nigeria, common factor is deductible, that is vision, innovation and creativity is the hallmark of modern banking. This will position banking industry as a strong instrument of economic development and growth of the host country beside its routine services of holding deposits and offering of loans; this is the philosophy of multidimensional knowledge acquisition in banking industry

as a competitive advantage. A giant bank is a bank that stands with the full portfolio of competencies and skills in modern banking services, products and operations.

The  level of  achievement of  a  man  is  the  level  of  knowledge  he  has. Knowledge is the battleground on which the hope of established enterprise must rest. They have potentially very large advantages. A clear advantage is the knowledge that established firms have in the practice of finance. They are  fully capable of delivering everything from transactional services to highly complex products. They have large investments in terms of both system and staff who are able to assess risk patterns. This is probably the key necessity for long-term success in financial services (Anthony, 2000). Banks can compete with knowledge and information in a number of areas: Competing  for  new  customers,  extending  the  relationship  with  current customers   and   extending   â€śwallet   share”,   reducing   risk   by   better understanding behaviour to reject or de –select potential problems, providing more  efficient  customer  services  and  best  advice,  to  support  multiple delivery channels (Anthony, 2000).

Multidimensional Knowledge acquisition as a competitive advantages in Nigeria banking industry will center on knowledge of various competencies, opportunities, services  and  operations  in  the  portfolio  of  banking  firms which make some world known big banks to be giants in banking industry as stated by Arua (2007), such banks like Standard Bank of South Africa, ABSA, Nedbank, Investec and  First Rand of South Africa these Banks control over 87.4% the banking industry total assets as of December 2004 in South Africa; Royal Bank of Canada, Toronto-Domino Bank Group, Scotia Nova Bank, Canadian Imperial Bank of commerce, Bank of Montreal  and

the National Bank of Canada control over 90% of the total industry’s assets in Canada. In Switzerland, the United Bank of Switzerland and the Credit Swisse control over 50% of total balance sheet of banks. In Italy we have Intesa BCI, San Paolo IMI, Unicredito, Bank dei Paschi di Sierna and Bank Lombard control over 51% of the industry’s assets by the end of 2000. In United Kingdom we have HSBC, the Royal Bank of Scotland, Barclays Bank, the  HBO and Loyds TSB Group dominate the  United Kingdoms banking arena. In Dutch, we have ABN Amro, Rabo Bank and ING Bank control 90% of total bank assets.

1.2     STATEMENT OF THE PROBLEM

Competitive Advantage of multidimensional knowledge acquisition in the Nigeria commercial banking industry was conceived by the researcher after having closer look into the services and products of Nigerian banks and having also studied academic works done on Nigerian commercial banks’ activities by previous researchers. The researcher identified poor knowledge of diversified  international   accepted best practices banking as  a  major contributing factor to instability in financial growth, unsatisfactory customers’ services, state of poor capital and assets base, non international standard performance qualities rating, low funding contribution to  economic sectors and  many other pitfalls  in Nigeria banks.  Acquisition of proper knowledge of these portfolio of competencies in banking services menu will create a competitive advantage or superiority edge for a banking firm in the Nigeria banking industry.

Commercial  banks  services  and  operations  globally  have  gone  beyond “time, demand and savings deposits” activities to other competencies of bank portfolio which will contribute positively to national economy at the same time create more wealth opportunities for the commercial banks. When the sectoral economy is developed, the profit or wealth proceed of such development will still go back to the commercial banks for saving as excess profit  and  indirectly  returning  money  and  quickening  rapid  growth  in finance and expansion of the operating bank. Knowledge of banking services portfolio affect treasury management. Majority of the Nigerian banks apply poor treasury management technique which lead to illiquidity and assets/ liabilities mismatch.

The  portfolio of  knowledge  in  banking  services  and  operations  include ethical standard behaviour in banking job. Abuses of public trust by stakeholders of a banking firm will end the individual bank on a short life span. The practice whereby some management staff loan money fraudulently on selfish interest basis as against lending on acceptable banking principles is unacceptable. Some banks in Nigeria are operating at a loss due to non- performing loans.  Most  times the  management of  such banks  take  into account the interest on non-performing loans. The loan officers should have sound knowledge on customers profile and their respective business venture before issuing out loans to avoid issues of bad debts.

The problem of poor fundamental banking knowledge among majority of employees in Nigerian commercial banks is now an issue of concern as many of these banks’ employees have no knowledge of banking from their

education degree qualification. The present attitude of Nigerian banks employing graduates of all disciplines including pure sciences, humanity and education based disciplines only to expose them to few weeks/months intensive bank training and only to end up producing novice bankers who cannot  deliver appropriate bank  services  nor  add  to  banking service  or product innovation and creativity. Their level of knowledge and contribution to bank services is on the instruction given to them by their immediate supervisors who also have poor diversified knowledge in banking. An employee of no seasoned knowledge, no vision, no creativity and no innovation is  equivalent to  a  robot.  Thus  the  study focus on the  topic; competitive advantage of multidimensional knowledge acquisition in Nigerian banking industry.

1.3     OBJECTIVES OF THE STUDY

The thrust of this study is the competitive advantage of Multidimensional knowledge acquisition in the Nigerian banking industry as a yardstick for performance enhancement. To this end, the objectives of the study are:

i.        To  ascertain  the  extent  to  which  the  level  of  improvement  in international standard performance rating of Nigerian banks is enhanced by multidimensional acquisition of banking knowledge.

ii.       To determine whether acquisition of diversified banking knowledge is compatible with the quality of services Nigerian banks offer to the satisfaction of customers.

iii.      To  evaluate  the  impact  of  adequate  multidimensional knowledge acquisition on financial strength, robustness and competitiveness of a bank.

iv.      To  determine the  rate  of Nigerian banks financial contribution to industrial sector  growth  in  Nigeria  through  diversified knowledge acquisition in banking.

v.       To determine the extent to which financial support of Nigerian banks to  commercialization of agricultural sector of Nigeria economy is enhanced by acquisition of multidimensional knowledge in banking.

vi.      To   determine   the   degree   to   which   the   social   infrastructural development services of the Nigerian banking firms can be facilitated by the acquisition of multidimensional banking knowledge.

1.4      RESEARCH QUESTIONS

i.        To   what   extent   does   multidimensional  acquisition  of   banking knowledge enhance level of international standard performance rating of Nigerian banks?

ii.       Is acquisition of diversified knowledge in banking compatible with the quality of services Nigerian banks offer to satisfaction of customers?

iii.      Has   adequate   multidimensional   banking   knowledge   acquisition among  Nigerian  banks  any  positive  impact  on  financial strength, robustness and competitiveness?

iv.      How sufficient is the rate of financial contribution to industrial sector growth in Nigeria through diversified banking knowledge in the Nigerian commercial banks?

v.       To what extent is the level of financial support of Nigerian banks to commercialization   of   agricultural   sector   of   Nigeria   economy enhanced by acquisition multidimensional knowledge in banking?

vi.      To  what  degree  will  the  acquisition of  multidimensional banking knowledge facilitate the social infrastructural development services of the Nigerian banking firms?

1.5     RESEARCH HYPOTHESES

The hypotheses of the study are as follows:

HO1: Level of improvement in international banking standard performance rating is not greatly enhanced by multidimensional knowledge acquisition among Nigerian banks.

HA1:  Level of improvement in international banking standard performance rating is greatly enhanced by multidimensional knowledge acquisition among Nigerian banks.

HO2:  Diversified knowledge acquisition in banking is not compatible with the services provided to the satisfaction of Nigerian banks customers.

HA2:    Diversified  knowledge  acquisition  in  banking  is  compatible  with the   services   provided   to   the   satisfaction   of   Nigerian   banks customers.

HO3:   Adequate multidimensional knowledge acquisition has  no positive impact in financial strength, robustness and competitiveness among Nigerian banks.

HA3: Adequate multidimensional knowledge acquisition has positive impact on   financial   strength,   robustness   and   competitiveness   among Nigerian banks.

H04:   Acquisition of diversified banking knowledge in Nigerian banks do not have any significant rate of financial support in Nigerian industrial sector growth and development.

HA4:   Acquisition of diversified banking knowledge in Nigerian banks has significant rate of financial support in Nigerian industrial sector growth and development.

H05:   The level of financial support of Nigerian bank to commercialization of Agricultural sector of Nigerian economy is not greatly enhanced by acquisition of multidimensional knowledge in banking.

HA5: The level of financial support of Nigerian banks to  commercialization of Agricultural sector of Nigeria economy is  greatly enhanced by acquisition of multidimensional knowledge in banking.

Ho6:  Social infrastructural development services of Nigerian banking firms are not greatly facilitated by multidimensional banking knowledge acquired by Nigerian banking firms.

HA6:  Social infrastructural development services of Nigerian banking firms are greatly facilitated by the  multidimensional banking knowledge acquired by Nigerian banking firms.

1.6     SIGNIFICANCE OF THE STUDY

The study will make the following significant impact:

i.        The  Nigerian  Banks:  The  study  multidimensional knowledge acquisition will impact positively on the  financial strength and robustness and competitiveness of the Nigeria banks. Application of the right internationally accepted best practices banking in Nigerian banks will boost the funding of sectoral economy and this at long-run expands wealth creation and financial capacity of thee economic sectors  which will deposit their excess funds back to the banks as deposits. Many enterprises and industries depositing excess funds in the lending banks will increase the financial strength,  robustness and  competitiveness of  the  funding banks. This is currently obtainable in China as its banking industry properly funds the wide spread entrepreneurial  development, the enterprises at full growth will be depositing excess funds with their funding banks.

ii.       To the Customers: The segment of services, products and other financial operations of commercial banks customers will increase. Quality  and  quantity  of  commercial  banks  service  offers  will

improve. Commercial bank customers will be exposed to satisfactory and convenient services. The knowledge of banking services acquired by banks will determine the segment of banks’ services offered to customers.

iii.      To  Nigeria  Economy  and  Government:  The  study  will  be significant in sectoral economic development and growth of Nigeria. The study will also impact positively on human capital development and infrastructural development of Nigeria. The positive impact of the  study on Nigerian sectoral economic growth and development is a resultant effect of acquiring right diversified banking  knowledge  by  Nigerian banks  which  is  not  based  on exploitative extant services of demands, savings and fixed deposits accounts, operations but based on constructive services that have values to  national development.

1.7      SCOPE OF THE STUDY

The study will cover other integrated financial services of commercial bank besides being an institution that deals in money and its substitutes. Those integrated services are funding by way of loan for sectoral developmental projects like development and growth of Agricultural sector (Commercial Agriculture), Industrial sector (small, cottage, micro, medium and large scale enterprises), and provision of social services like health service projects, literacy assisted projects (like scholarship to indigent/active poor families and public education structures) The study will be capturing three commercial banks (Zenith Bank Plc, First Bank Nigeria Plc and Oceanic

Bank Plc). Judgmental sample method was adopted in choosing the three (3) study banks. The choice of three (3) States is for thorough, efficient and effective research work and is on purposeful sample approach. The study boundary will be 10 years of banking activities from 1999 to 2009.

1.8     THE AREA OF THE STUDY

The study was carried out in these commercial banks in River State, Imo State and Enugu State. Zenith Bank Plc, which has the following number of branches; Rivers state – 11 branches, Imo state – 5 branches, Enugu state – 8 branches. First Bank Nigeria Plc; which has the following number of branches; Rivers state – 25 branches, Imo state – 18 branches, Enugu state –

23  branches.  Oceanic  Bank  Plc,  which  has  the  following  number  of branches; Rivers state – 11 branches, Imo state – 7 branches, Enugu state – 9 branches. These are as of 1st November, 2011.

1.9     LIMITATIONS OF THE STUDY

The study had some set backs like:

i. Time Constraint:  The respondents’ (bankers’) very busy nature of work and tight schedules was a constraint to the treatment of the study questionnaires.

ii. Financial Constraint:  The researcher was limited by funds necessary to carry such a topical study beyond three banks and three states.

iii. Attitude of the Respondents: The respondents to the questionnaire of the study were bankers who by the nature of their work maintain high level of secrecy in information dissemination; this constrained the volume and

value of information released to the researcher in the process of carrying out the research.

1.10   PROFILES OF THE BANKS STUDIED

Zenith Bank Plc

Zenith bank was established May, 1990 and started operations in July, 1990 as a commercial bank it became a public limited company on June 17, 2004 and was listed on the Nigeria stock exchange on October 21, 2004 following a highly successful initial public offering (PO). The bank presently has a shareholder base of over one million, as indication of the strength of the Zenith brand.

Zenith bank bas mission to offer a unique range of financial services that underscore their corporate commitment to customers enthusiasm and value creation for stakeholders. Zenith bank operate practical delivery on a highly automated platform that makes them unique. The treasury transactions, their

knowledge  in  the  market  place,  coupled  with creativities  in  the  money market, which has a resultant competitive advantage that has been of tremendous value. Zenith bank main service point is to create a product focus that gives financial institutions competitive advantage in service delivery to their customers. Zenith bank leadership assets are manifested in the ability of their managers to combine strands of knowledge to create fact action value for the customers. They combine vision with precision; using creativity, skills and ideas to expand their business reach into the lives of the customers by helping them fulfill their needs with incredible speed. Zenith bank not only offers customers satisfactory services and products, they also engaged in wealth creation to stakeholders including government and non government agencies centred on institutional building and capacity development for entrepreneurship in the following areas:

*        Strong commitment to the support of small and medium enterprises as well as development of indigenous industries

*        Entrepreneurs incubation for our youths through sustained funding of institutions responsible for entrepreneurship development

*        Development of the real sector of the economy through provisions of funds to the manufacturers at reduced cost

Services and products offered by Zenith Bank: Zenith bank offers the following range of services and products to their numerous customers.

*        Account opening

*        Investing

*        Zenith mortgage loan

*        Western union money transfer

*        Zenith Bureau De change

*        Local money transfer

*        Local money transfer

*        ATM location

*        Internet Banking

*        Telephone / mobile banking

*        Online bills payment

*        Alerts

*        Z- mobile

*        ZECA (zenith children account)

Corporate Services

*        Account opening

*        Corporate Banking

*        Investment banking

*        Retail banking

*        Corporate Internet banking

(ADPS PLUS)

*        Automated cheque writing

*        Reconciliation tool

*        Automated pay roll

*        Merchant services

*        Trade alert z

*        Swift pay

Zenith Bank Correspondence Banks

Zenith bank has established correspondence banking relationship with banks outside Nigeria. All international transactions are routed through the networks of the following correspondent banks:-

*        Australia and New Zealand bank

*        BNP peribas Paris

*        Citibank N.A. New York

*        Citibank N.A London

*        Commercial Bank AG, Fran Furt

*        Deutsche Bank London

*        Fortis Bank

*        HSBC Bank PLC, South Africa

*       JP Morgan Chase Bank London

*        JP Morgan Chase Bank New York

Zenith Bank rating

*        Augusto and Co. (2003-2007) Aa a

*        Fitch Ratings (2007) AA

*        Standard and Poor’s (2007) BB

The ratings reflect adequate levels of capitalization and the potential that capital levels will be further enhanced. The stable out look balances the

banks  ability  to  benefit  in  terms  of  size,  profitability,  from  strong macroeconomic growth

Zenith bank awards and achievements

*        African Bankers Award

*        Best Global Bank (2008)

*        Euromoney  Best bank in Nigeria (2008)

*        Vanguard bankers’ Awards: Best Bank in ICT (2008)

Best Bank in Export Financial (2008)

*        This Day Awards of Excellence: Bank of the year (2008)

CEO of the year (2008)

Most corporate socially   responsible company in   Nigeria (2007) Corporate citizen of the year (2008)

*        KPMG Award

Most customer focused Bank (2008)

*        African investor:

Africa’s Bank of the year (2007)

*        Nigeria stock Exchange (NSE Quoted Company of the year (2007)

*        Bank T. Top, African Banker award:

Most corporate      socially responsible Bank in Africa     (2007)

*        Federal Inland Revenue service Award: Best Collecting Bank

*        Web-Jurist Award (2001, 2002, 2003, 2004, 2005, 2006 and 2008)

*        Philip’s Consulting:

Best Bank Website in Nigeria, 1st over –all rating

*        The Bankers Financial Times of London: Bank of the year – (2005)

Zenith Bank subsidiaries

*        Zenith General insurance

*        Zenith Pensions custodian

*        Zenith securities

*        Zenith life assurance

*        Zenith capital

*        Zenith Trustees Limited

*        Zenith Bank Ghana

*        Zenith Bank United Kingdom

*        Zenith Bank Sierra Leone

*        Zenith Bank Representative office South Africa

First Bank Nigeria PLC

First Bank was incorporated as a limited  liability on March 31, 1894 with Head office in Liverpool by sir   Alfred Johnes, a shipping magnate. The bank has a specific goal to offer the services that customers and clients

expect   from   larger   financial   service   firms   in   community   banking environment. First bank Nigeria financial years ends 31 March.

Services and products offered by first bank Nigeria:

First bank offers the following range of products and services:

*        Checking accounts

*        Savings accounts

*        Business services

*        Public finance group

*        Merchant card services

*        Resource Online

*        Merchant service customers

*        Convenience products

*        Visa check card

*        First call banking

*        Online banking

*        Appling for online banking

*        Apply for online bill pay

*        Direct Deposit

*        Over-draft production

Corporate services

*        Equipment leasing

*        Export Banking and finance

*        Global custody

*        Foreign financial institutions

Retail services of first Bank Nigeria

*        Account opening

*        Foreign operations

*        U-first customer loans

*        Lending

*        Interest rate

*        Mortgages

*        Western union money transfer

*        Alternative delivery channels

*        Investor relations

First Bank Nigeria correspondence Banks

*        First Bank Nigeria (United Kingdom) Limited

*        Deutsch Bank Ag (Bankers Trust Company) New York,  New  York.

*        Citibank N.A. Wall street, New York, New York United  States       of

America.

*        HSCB Equator Bank PLC, United Kingdom.

*        Banque Belgolaise Camomile street London, United Kingdom

*        Standard Chartered Bank, New Jersey, United States of America.

First Bank Nigeria (FBN) Rating

    FBN Plc. …….. Analyst Coverage and Rating.

Financial Documents Investors FAQAs. December 2009 Annual Report Investors

Relations Downloads

    S and P Rating report April 14, 2009

FBN Plc.

    Global Credit Rating November 2008

First Bank of Nigeria Plc.

    Standard and Poor FBN Plc. Rating Report March 2009.

    FBN – Wikipedia, the Free Encyclopedia.

FBN IS A Nigerian bank and financial services firm …… with economic financial crimes commission giving a strong rating.

       Banks in Nigeria –  FBN Plc. cool first bank Nigeria Plc. Rating on question.

        FBN Plc. 20/10/18/17 – S & P Credit Research…17 August 2010… The ratings  on  FBN  Plc.  (First  Bank)  are  constrained  by  the  bank’s Weakened assets quality and barely adequate.

        FBN Plc. Opens  N100 billion offer financialnigeria.com. 15/May 2007… The widely expected FBN Plc  N100 billion … The short-term rating is also the biggest attainable by any institution.

        Commercial Credit Reports for FBN Plc 10/4/2010. Fitch Affirms FBN Plc’s Reting Dow Jones International News. 10/1/2010 Fitch Affirms FBN’s IDR at “B+”

        Are  the  ratings  of  Nigeria  banks  reliable?  Similarly,  the  long-term Nigeria scale ratings for FBN Plc, Guaranty Bank Plc, and Intercontinental Bank Plc were lowered …

First Bank Nigeria (FBN) Award And Achievement

 First Bank Nigeria Plc bags University of Ibadan Diamond Benefactor

… Banking Achievement for Africa Award 2007 – Financing market.

 Achievements – Equity Bank – The Listening Caring Financial Partner.

 Banks Awards 2010 nominees Anounced 15 September 2010 .. FBN Capital Ltd Nigeria Rand Merchant Bank (RMB) South Africa.

Oceanic Bank Plc

Oceanic Bank commenced business on June 12, 1990 at the Water Front Plaza, Plot 270 Ozurumba Mbadiwe Avenue Victoria Island Lagos. It was listed on the Nigeria Stock Exchange on June 25, 2004. Oceanic Bank is 19 years old commercial bank with branches located in several part of Nigeria. Its financial year is from January 1st to December 31st of every year. Present location of Oceanic Bank Headquarter is at Hebert Macaulay Way Wuse, Zone 6, Abuja. Oceanic Bank has a goal of “providing excellent customer services our passion”. It has an aim “Exceeding our customer expectation always”, that is why we are passionately committed to satisfying you”. Oceanic Bank services And Products

The bank classified their products and services to:

  Corporate banking

 Public sector servicing

 Treasury and financial

 Institution servicing

 Estate planning

 Education planning  Financial planning  Tax planning

 Discretionary account

Oceanic Bank Correspondence Banks:

 Frankfort, Germany Commerce Bank

 Fortis Bank, Fortish Bank SANV, London.

 Standard chartered Bank, (All united kingdom offices) London.

 Deutsche Bank, London, Frank Fort.

 Deutsche Bank AG, Hong Kong

 Deutsche Bank AG, Seoul branch, Seoul Koriea

 Deutsche Bank AG, Mumbai branch India.

Oceanic Bank Rating:

*        Best Brand USP consumer brand Award, COBR AA

*        FT Top 1000 Banks in the World “ Aa” Rating Augusto  and Co.

*        â€śA”, + “AA” – Global Credit Rating (South Africa)

*        â€śAA” “ Pharez Risk rating.

Note: “A” = Short term liquidity, is outstanding and safety is just below that of risk free treasury Bill.

“AA” = Very high credit quality protection factors are very strong. Adverse changes in business world not significantly increase investment Risk.

Oceanic Bank Awards and Achievements:

o   EMEA- finance named Oceanic Bank, Best bank in Nigeria (2008).

o   The  Banker  Magazine,  Financial  Times,  London  â€“  Best  bank  in

Nigeria, 5th in Africa and 310th in the world in terms of tier 1 capital.

o   NAPEB – Best Bank in poverty eradication in Nigeria (2008).

o   Champion News papers – outstanding support to infrastructure and economic development (2008)

o   Vanguard newspaper best bank in SME financing (2008)

o   Banker magazine London – Bank of the year (2006 and 2007)

o   CBN (Central Bank of Nigeria) award 2003 –“Best bank in real sector financing” leading investor in small and medium industries equity investment

Oceanic Bank Subsidiaries

*        Oceanic Home

*        Oceanic Trustees

*        Oceanic pension custodians

*        Oceanic Health

*        Oceanic life

*        Oceanic capital

*        Oceanic insurance

*        Oceanic registers

*         Oceanic securities

1.11   CRITERIA FOR SELECTION OF BANK:

The following criteria are demanded for a bank to qualify for this research work: –

 Must  be  a  commercial bank,  duly registered and  incorporated by Nigeria Corporate Affairs Commission and support its financing by equity capital and shareholders funding.

 Must have branches all over 36 States of Federal Republic of Nigeria and Abuja. Also may have branches abroad.

 Must have been in existence for the past ten (10) years by 2009.

 Must have capital base of N 100 billion and above.

 Must be indigenous bank run by Nigerian stakeholders.

1.12   DEFINITION OF TERMS

* CBN – Central Bank of Nigeria

* IFRS – International Financial Reporting Standard

* TFC – Total Fixed Cost

* TR – Total Revenue

* TC – Total Cost

* VBM – Value Based Management

* BOS – Blue Ocean Strategy

* KBF – Key Business Factor

* IT – Information Technology

* BI – Business Intelligent

* FBN – First Bank of Nigeria

* SME – Small and Medium Enterprises.

REFERENCES

Arua,  .N.  (2007),  Nigeria  Bank  and  Globalization.  Union  Digest,  An

Economic and Business Publications of Union Bank of Nigeria Plc.

11 (1 and 2) June.

Dasgupta, A.K. and Pearce, D.W. (1978), Cost Benefit Analysis; Theory and

Practice. London: Macmillan Press Limited.

Ebong, B.B. (2005), The Banking Industry and Nigeria Economy. Union Digest, An economic and Business Publications of Union Bank of Nigeria Plc. 9 (3 and 4) June.

Encyclopedia Britannica (2004).

Girish, G.V. (2001), Banking Business Units Challenges and Achievements, Infosys Technologies limited, Annual Investor Meet; Bangalone.

Goran, Radonic (2006), Review of Business Intelligence Approaches to key

Business Factors in Banking. Journal of Knowledge Management Practice,

8(511) May 2007 papers selected from Centre for Business Information Organization and Process Management (BIOPOM) 1st  International Conference 2006 University of Westminster, London, UK.

Grosse, Robert (1984), Competitive Advantages and Multinational Enterprises. University of Miami Discussion papers in International Business, (847) November 1984.

John, O. Alabi (2010), Value-Based Management for Personal and Corporate Excellence. Unpublished paper presented at Nigeria Institute of Management (NIM) New Membership, Induction Ceremony at Nigeria University Commission (NUC) House, Maitama Abuja Nigeria. September,

22nd 2010.

Marcel, Okeke (2010), Economic; Stability is the game, Zenith Economic

Quarterly, Nigeria Publication of Zenith Bank Plc. 5(1) January.

Michael, E. Porter (1990), The Competitive Advantage of Nation. New York. Free Press.

Oboh, G.A.T. (2004), “Contemporary Management Practices and the Challenges to Banking Business in Nigeria” Union Digest. An economic and business Publications of Union Bank of Nigeria Plc. 8 (2) June.

Robert Grosse, Duane Kujawa (1991), International Business Theory and Managerial Application, United States of America. R.R. Donnelley and Sons Company.

Uzor,  Mike  (2010),New  Banking  Model  in  Nigeria;  Opportunities  and

Challenges, Zenith Economic Quarterly, 5 (4). 2010.

W. Chankim and Renee Mauborgen (2005) Blue Ocean Strategy. August

10th, 2010 2pm

Zenith Bank Plc 2010. July 22, 2010. 12pm

First Bank Nigeria Plc 2010. July 25, 2010 11am http://www. google.com/firstbanknigeria.com

Oceanic Bank Plc 2010. July 26, 2010 1pm http://www. google.com/oceanicbank.com


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