15 August 2018

Nigeria: Keystone Bank - Emerging Whiz-Kid On the Banking Block

Since the financial crisis that enveloped the global market a decade ago, the profitability and reputation of banks has been under tremendous pressure worldwide, Nigeria inclusive. Whilst the banking industry is now regaining its health, the entrant of fintechs and neo-banks in the industry is posing a new threat. This digital disruption is changing the traditional way through which customers obtain financial services, hence putting more pressure on banks' profitability.

However, a bank in Nigeria, Keystone Bank Ltd, is challenging the status quo by making transformation and profitability appear like a mere walk over as revealed in its achievements within a short time span. From the perspective of the results on ground, it appears to be a great time for Keystone Bank. In just one year of AMCON's divestment, the bank has changed its narrative from "one of those banks" to a financial institution to be reckoned with and as a result is experiencing an influx of business minded customers.

Keystone Bank's ambitious and holistic transformations have taken industry watchers by surprise, and the industry itself by storm. Besides the revamping of its branches across the nation and bolstering its workforce, it has invested substantially in technology and developed fully integrated service models that enable its customers enjoy banking services through a wide range of channels.

The bank's journey to reckoning had been long and winding, which necessitated a takeover by the Asset Management Company of Nigeria (AMCON) in 2011.

However, its acquisition by Sigma Golf - Riverbank consortium seemed to trigger a turnaround as it precipitated a change in the management team to the one that holds the magic wand for the positive outlook it has been experiencing to date

On taking over, the new management team led by its Group Managing Director/CEO Mr. Obeahon Ohiwerei drew up a holistic and integrated approach to business modernization which elevated the bank to deliver a superior customer-centric experience. The impact of this change reflected positive results in its Q1 report card, which, from all indications, is a restoration of customers' trust in its system.

The bank for the half-year ended June 30th, 2018 recorded a profit before tax of N5.83bn, compared to a loss of N6.78bn over the same period in 2017. Deposit grew by 51%, from N206bn to N312bn between June 2017 and June 2018

From evolving technologies to changing customer expectations to new regulatory demands - it has never been more important for banks to come up with the right strategies for digital transformation and innovation; the Ohiwerei team nonetheless made this a reality at Keystone Bank. This entailed initiating partnership processes with foremost technology-enabled concerns to drive its digital revolution.

Its partnership with CeLD Innovations Limited to launch a ground-breaking loyalty reward initiative which involves the gifting of 'CashToken', is one of such moves. This innovative gift commodity, Cash Token, which was formally launched in Lagos on Thursday April 19, 2018 at a conference tagged "500 Top CEOs Conference - Unleashing - The Age of Hyper Consumer Centricity, is an electronic reward and celebratory gift commodity which costs only N30.

The initiative, according to CeLD, creates a chance for every customer in Nigeria to win life-changing cash rewards every Friday night on the National CashToken draws which is monitored by Alexander Forbes and audited by Deloitte. This initiative is designed to optimize customer loyalty investment for business, celebratory gift value optimization and public emotional equity for government.

The bank has also launched its revamped mobile banking application upgraded with new and exciting user-friendly features for a more convenient banking experience. Customers can now enjoy many benefits & access self-service options, such as, easy account opening, convenient self- booking and liquidation of fixed deposits, an expanded list of bill-payment options and easy activation of standing instructions & recurrent future payments.

Other notable features of the mobile App are, a "Switch Card ON/OFF option" which allows users to disable their cards temporarily if missing & re-enable at the click of a button, the "Hide Balance Feature" safeguards against third-party viewing and the "Meet Your Relationship Manager Option" allows users to call or email their account officers right within the app.

In addition, the Bank was the first in the sector to introduce the Chat-bot feature called OXYGEN which enables banking on Telegram and Facebook. It guides users through a whole range of desired transactions step-by-step.

Another first from the Bank is the Zero Data Banking feature that enable customers transact on their phones without data. Keystone Bank has remained the only Bank with this feature on its Banking App.

And for the first time in its operations, Keystone Bank also introduced a new SMART number for customer support, this eliminates the need for customers to remember multiple numbers while removing the uncertainty as to which of the lines are actively engaged.

These and many other moves leveraging technology and building a culture of innovation is fast repositioning the bank as a new whiz kid on the banking block, which, according to its group managing director, Mr. Obeahon Ohiwerei is a proof of the hard work and resilience of the board, management and staff of the bank.

Today, Keystone Bank's branches are fast becoming a hub for transactional activities witnessing a huge footfall of customers trooping in to carry out transactions, open bank accounts and experience the innovative trends that the bank has introduced to its business. This overall experience has also been boosted by the enhancement of staff morale which inherently drives the commitment to serve their customers better.

From the look of unfolding events at Keystone Bank, it's clear to see that, it's just a matter of time before the bank starts operating in the first tier again.

Felix Onajite, a financial analyst writes from Lagos, Nigeria.

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