First Bank of Nigeria Limited has been named the most valuable banking brand in Nigeria in the Top 500 Banking Brands of The Banker magazine of the Financial Times and Brand Finance, London, United Kingdom.
The bank, which is also the only Nigerian bank in the top 10 banking brands in Africa, along with nine other banks from South Africa and Morroco, is being named for the sixth consecutive time.
According to a press release issued on Sunday by the Country Representative, Nigeria, The Banker magazine, Kunle Ogedengbe, First Bank leads four other Nigerian banks in the global ranking.
With $301 million brand value, First Bank ranked 357 led Guaranty Trust Bank, GTB, ranked 395 with a brand value of $258 million, and Zenith Bank 414 with a brand value of $247 million.
Access Bank followed at 476 with a brand value of $182 million and the United Bank for Africa (UBA) with a brand value of $172 million ranked 487 in the world.
While explaining the methodology of the ranking, the Editor, The Banker, Brian Caplen, said that Brand Finance employs a discounted cash flow technique to discount estimated future royalties at an appropriate rate to arrive at a net present value of a bank's trademark and associated intellectual property.
Mr. Caplen explained that the process involved five steps which include obtaining brand-specific financial and revenue data; modelling the market to identify market demand and the position of individual banks in the context of all other market competitors.
He added further that it will also establish the royalty rate for each bank; calculate the discounted rate specific to each bank, taking account of its size, geographical presence, reputation, gearing and brand rating; and discount future royalty stream (explicit forecast and perpetuity periods) to a net present value.
Mr. Caplen disclosed that the approach is used for two reasons, noting that it is favoured by tax authorities and the courts because it calculates brand values by reference to documented third-party transactions, and it can be done based on publicly available financial information.
The deputy editor of the magazine, Joy Macknight, said on the global front, Industrial and Commercial Bank of China is number one with a brand value of $47,832 million followed by Well Fargo of the United States of America with a brand value of $41,618 million.
The remaining eight banks in the top ten are China Construction Bank, Chase (JP Morgan & Co of the USA), Bank of China, Bank of America, Agricultural Bank of China, Citibank (USA), HSBC (UK), and Satander (Spain) noted Macknight.
According to the realease, in the top 50 countries in the world, only four African countries made the list. These are South Africa (26), Nigeria (42), Egypt (46) and Morocco (47).