The bank is “looking at opportunities to scale up”, which may include making acquisitions, going public or selling a eurobond, Udensi says in Lagos. “Everything is on the table.” Titan Trust plans to expand its branch network with about 10 new branches in the next six to 12 months, she says, with new branches in Abuja and Apapa close to being ready.
- For now, the focus is on organic growth, she says. “Our model has worked.”
Titan Trust Bank started operating as a commercial national bank after obtaining its license in April 2019. It has been able to grow by improving speed and efficiency of customer service, Udensi says. “Customer experience was at a major low, especially in retail,” when the bank opened. “The market had lost trust” in Nigerian banks, she says.
The bank is led by CEO Mudassir Amray, a former Citibank executive, and Titan Trust counts Citibank as a correspondent bank. Udensi is a former executive with Heritage and Zenith. Titan Trust made money in 2019 despite being open for only 81 working days, and has remained profitable since. The bank made a profit of 644m naira in 2019, rising to 2.9bn naira ($7m) in 2020.
That was achieved due to digital targeting of a young customer base combined with a small number of physical branches, she says, adding that’s it’s possible to open an account via an app in as little as three minutes. The bank tries to hire young staff as part of its strategy. “The other banks have grown old,” she says.
- In February, the bank partnered with International Finance Corporation (IFC) to start an online platform to help business owners run their businesses during the COVID-19 pandemic.
- The bank is working on a new referral model which will reward customers for getting new people to sign up for accounts. Udensi hopes to roll it out in the next 30 to 60 days. “It’s on the top burner.”
Such rapid sign up of customers has been achieved without running into bad loan problems, Udensi says. In fact, she says, the bank hasn’t made a single bad loan in either its retail or corporate customer base. Most major Nigerian corporates are now clients, she adds.
The bank uses the Oracle banking app to provide services and, Udensi says, is the only bank in Nigeria which is running the latest version of the app. But Oracle does not address the Nigerian context, so the bank also runs its own local credit-scoring process which draws on Nigerian credit bureau information.
Still, asset quality at Nigerian banks is set to come under pressure as prospects for economic growth this year remain modest, according to research published by Moody’s on July 20.
- Problem loans at Nigerian banks are set to rise to 9% of total loans by the end of this year, versus 6% in 2020, Moody’s predicts.
- That will give Nigerian banks the joint highest level of problems with Russia among the emerging markets Moody’s surveyed.
Titan Trust’s systems for avoiding bad loans are likely to be tested as it continues to expand.
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