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When Jim Ovia founded Zenith Bank in 1990 with a shareholder’s fund of N20million, little did he know he was planting an Iroko tree that has its roots sprouting across the world financial and banking sector like an octopus. 25years on, the success story of Zenith Bank is written in flowery prose as its shareholder’s fund has not only grown astronomically to well above N600 billion but has become one of the leading financial institutions in Africa, thriving on strong values, brand equity, corporate culture of professionalism and service excellence which are the foundations upon which the bank was built.
From a humble beginning, Zenith Bank foray into the Nigerian banking industry was woven on a shared common destiny with a high-flying first Managing Director of the bank, Jim Ovia. Established as Zenith International Bank Ltd in May 1990, it became a public limited company in July 2004 and had an initial public offering on the Nigerian Stock Exchange (NSE) on October 21 of that year. It is a Nigerian success story and central to it is Jim Ovia. Taciturn and brutally efficient, the high-flying founding Managing Director’s story is a rags-to-riches story, which he hardly makes public. As one of Nigeria’s most successful businessmen, the almost total absence of personal details in his profiles raise questions.
Born into a humble family in Ogbemudein, Agbor, Delta State on 4th November 1951, Jim passed through the local primary school and attended Ika Grammar School, Boji-Boji-Owa from where he came out with a good West African School Certificate result. Shortly after he finished secondary school in 1973, he was hired by the Ikeja branch of Barclays Bank as a clerical officer. He worked for several years as a bank clerk before he found his way to the United States of America in search of greener pastures. While there, he attended Southern University, Baton Rouge Louisiana and North East Louisiana University Monroe renamed in 1999 as University of Louisiana, doing odd jobs and every other thing needed in the struggle to survive. From these universities he obtained his bachelor’s degree and MBA respectively.
On his return to Nigeria, he joined Lion Bank where he learnt the nitty-gritty of banking. He rose through the ranks to become the bank’s branch manager in Lagos. He later joined the International Merchant Bank, IMB in 1980 where he rose from the position of a financial analyst to manager. He then moved as a general manager to Merchant Bank of Africa where he set up a thriving corporate division. From that point onward things began to look up for Jim Ovia.
Following the deregulation of the banking sector by the Babangida administration in the late 1980s. Jim Ovia teamed up with other entrepreneurs to apply for a banking license. He would be one of the 20 shareholders behind the setting up of Zenith International bank in May 1990. The bank opened for business in July of the same year with Jim Ovia as MD. Zenith International Bank was soon packing in customers as one of the new generation banks where customers were spared the stressful and time-wasting banking practices of the old generation banks.
Within a few years, the bank’s business had become quite substantial. The customer friendly innovations of new generation banks were creating a boom in the banking industry and Zenith International Bank gradually entrenched itself alongside others such as Guaranty Trust Bank, Intercontinental Bank and IBTC in the vanguard of this ICT driven and high flying banking revolution. It was certainly a clear testimony of the managerial acumen of the men who ran these banks: Jim Ovia, Fola Adeola, Erastus Akingbola and Atedo Peterside. Leveraging on Information and Communication technology innovation, these new captains of industry turned their new generation Nigerian banks into solution providers for Nigerian economic development, providing banking conveniences previously unavailable and from then indispensable. The big old banks had suddenly become dinosaurs struggling to adapt and survive.
All manner of reasons have been adduced for the success of Zenith International Bank. While some say the bank depended a great deal on big time Igbo businessmen who did high profile transactions; others say it was as a result of the bank’s money transfer facility and heavy foreign exchange deals. But Jim Ovia’s explanation for the tremendous success of Zenith was quite simple. He said it was the speed, efficiency and responsiveness of the bank’s service and packaging of it that attracted customers to the bank.
Nine years after its establishment, Zenith International Bank had grown to twenty-three branches. In that financial year which ended on 30th June, 1999 a month after the first term inauguration of President Olusegun Obasanjo, the bank’s profit-after-tax was N1.352 billion, an increase of 27 percent compared with N1.06 billion in the previous year. This result ranked Zenith in 1999 as the third most profitable bank in Nigeria and fifth largest bank in terms of assets and profitability.
The banking consolidation exercise of 2004 was designed to achieve a diversified, strong and reliable banking sector that could play active development roles in the Nigerian economy and be a competent and competitive player in the African and global financial system. Despite some skepticism, the exercise was successfully concluded by December 31, 2005. The exercise which lasted from June 2004 to December 31, 2005 increased the mandatory capitalization of banks from N2 billion to N25 billion. By the time it was over, the number of banks in Nigeria had dropped from 89 in 2004 to 25 in 2006. As a result of the recapitalization, five Nigerian banks appeared among the first 500 in the world. They were First Bank of Nigeria PLC, Intercontinental Bank PLC, Zenith Bank PLC, Union Bank PLC and United Bank for Africa PLC. Three banks were also listed among Forbes’ top 2,000 world biggest companies. They were First Bank, UBA and Intercontinental Bank.
Zenith Bank’s total assets in 2004 was N215billion, the bank’s profit before tax had increased from N5.4bn in 2003 to N6.4bn. In a bid to meet the N25 billion capital requirements stipulated by the CBN Zenith International Bank Ltd decided to go public, changed its name to Zenith Bank PLC and went to the capital market in July 2004. Its shares were over-subscribed. Its Initial Public Offering (IPO) at N10.90 per share raised about N48 billion, regarded then as the highest amount to have been raised in the Nigerian capital market during the period under consideration. Due to regulatory provisions, it could not absorb all the money raised but retained about N36 billion. Its shares were listed on the Nigerian Stock Exchange in October 2004 . Zenith Bank PLC’s total assets by the end of June 2005 plus contingents had gone up to N370.72 billion with a profit before tax of N9.1 billion. The number of Zenith Bank branches around the country had also increased to ninety five. On 27th April 2007, Zenith became the first Nigerian bank in 25 years to be licensed by the UK Financial Services Authority (FSA), giving rise to Zenith Bank (UK) Limited. Zenith Bank already had subsidiaries in Ghana, Sierra Leone and Gambia.
In a second public offering in 2007, Zenith Bank raised about N50.7 billion The bank had offered for subscription 1,763,000,000 ordinary shares of 50k each at N38.90k and a rights issue of 1,654,557,911 units at N36.90k. The offer opened on Thursday, December 6th, 2007 and closed on January 17, 2008.
In 2009, the Central Bank of Nigeria CBN conducted a special audit to ascertain the stability of the banking sector in the country. Zenith Bank was among 14 banks given a clean bill of health. Some of Ovia’s peers who pioneered the Second Generation Banking Sector fell in that CBN special audit of banks. Ovia emerged from the purge as perhaps the most important survivor. Some of the biggest names in the industry had fallen. Ovia hardly had any peers left in the industry. No other banker who had found and built a bank the size of Zenith had survived. Still, he could not quite escape the new CBN rules pegging the tenure of bank MDs. It necessitated an exit strategy.
Brilliant, technology-savvy, American-trained Jim Ovia had made history. He had taken Zenith Bank, a second generation Nigerian banking brand from obscurity to predominance, building an iconic corporate identity, leveraging on technology and reliable service delivery to make life more convenient for consumers, early in the day spear-heading the revolution of Nigerian banking habits with online, real time banking.
When this became the industry standard, Ovia raised the bar by having the most reliable ATM network service delivery and being the first bank to introduce ATM Galleries in major cities. Zenith Bank Plc announced a N50.026 billion profit before tax (PBT) for the full year ending December 2010, representing 78.57 per cent increase from N28 billion recorded by the bank in the corresponding period of 2009.
It was not always plain sailing for Jim Ovia. On 19th December 2008, it was widely reported that he was arrested by the Economic and Financial Crimes Commission in connection with a N3.5 billion graft involving the former chief of staff of Government House, Port Harcourt and some Zenith Bank officials. Jim Ovia was released the same day while the other arrested Zenith Bank officials were remanded in custody and later arraigned before the Port Harcourt High Court. After several adjournments lasting over several months, the bank executives were discharged.
Criticisms had also been leveled against bank MDs including Ovia for driving their marketers too hard, setting outrageous performance targets which according to these allegations drove marketers, overwhelmingly female into employing lewd tactics in snaring prospective depositors.
Jim Ovia’s two decade career as MD of Zenith Bank ended on 1st August 2010 when he was succeeded by his deputy MD Godwin Emefiele, his Agbor kinsman and a fellow old boy of Ika Grammar School, Bojiboji-Owa.
Two years after his exit, his successor, Godwin Emefiele, a pioneering staff member who had been on the board for more than a decade before succeeding Ovia has seamlessly continued with the tradition left by Ovia. The bank’s shareholder base increased to over one million and shareholder funds of $2.55 billion as at the end of Q2 2012. Then Zenith had over 500 branches and business offices nationwide. The bank’s total assets increased from $1.25bn in 2004 when it went public to $15.48bn in Q2 2012. Within the same period, total deposits went from $845m to $10.77bn and the bank shareholding population has swelled from 20 to over 700,000 shareholders.
Following the confirmation of Mr. Godwin Emefiele as the next Governor of the Central Bank of Nigeria (CBN) in 2014, the Board of Directors of Zenith Bank Plc has approved the appointment of Mr. Peter Amangbo as the Managing Director/CEO-designate, effective June 1, 2014. The appointment which is consistent with the bank’s tradition and succession strategy of grooming leaders from within has further boosted the fortunes of the bank. Amangbo holds an MBA from the Warwick Business School and a B.Eng in Electrical and Electronics Engineering from the University of Benin. He is also an alumnus of INSEAD and a fellow of the Institute of Chartered Accountants of Nigeria. He becomes the third chief executive officer of the 24-year-old bank.
Amangbo who has over two decades of banking experience with Zenith Bank in corporate finance and investment banking, business development, credit and marketing, treasury, financial control and strategic planning and operations was appointed to the board of the bank and its subsidiary companies in 2005, and was a pioneer Non-Executive Director of Zenith Bank UK. Under his watch the bank’s record of distinction continues with the bank posting a record N83.087 billion profit after tax in the third quarter of 2015 which is 16.9% above the profit declared same period last year.
However, four years after retiring as the Chief Executive Officer (CEO) of the bank, Jim Ovia, the bank’s pioneer Managing Director and CEO was appointed as the Chairman of the Board of Directors and non-executive Director of the bank in June 2014. He follows in the footstep of Akinsola Akinfemiwa who returned to the banking industry as the Chairman of Heritage Bank Plc in 2013. Akinfemiwa also had to retire as the Managing Director of Skye Bank Plc due to the CBN policy.Speaking on the challenges ahead, Amangbo was optimistic of good fortunes,
“Going forward, our challenges will include, though not limited to, further elevating our standing as a reputable financial institution by establishing a corporate structure that can stay imperturbable. However, I am glad that we are well positioned and adequately equipped to remain at the forefront of Nigeria’s financial services sector,” he said.
