South Africa’s banking giant, FirstRand, has firmed up its position in the West African region, through securing an operating license for its division RMB in Nigeria, which positions the group to grab a share of the oil driven economic revolution underway in the region.
RMB announced that it has officially opened RMB Nigeria in Lagos following the granting of an investment banking license by the Central Bank of Nigeria.
RMB, a division of FirstRand, said it has been operating in Nigeria from a representative office since January 2010 and is already a meaningful player in the Nigerian investment banking sector.
FirstRand chief executive Sizwe Nxasana said the establishment of RMB Nigeria, which required an initial capital investment by the Group of $100 million, is in line with FirstRand’s strategy to build a presence in high-growth African markets with attractive long- term prospects. “This move is completely consistent with our objectives as we often enter a new market through the appropriate operating franchise, in this case RMB. Nigeria currently offers strong growth prospects particularly with regards to corporate and investment banking”.
Nigeria which is currently the second largest economy in Africa after South Africa, is expected to register massive growth going forward. This is largely due to its oil reserves. Its neighbor Ghana is ramping up its oil producing capacities in its freshly discovered fields.
A report released recently by PwC noted that Nigeria could be the fastest growing country among the group of seven hiogh growth economies, due to its youthful and growing working population. The PwC report said this does rely on using its oil wealth to develop a broader based economy with better infrastructure and institutions and therefore support long-term productivity growth.
RMB chief executive Alan Pullinger said RMB Nigeria allows the bank to rapidly build its franchise, provide products and services to corporate and institutional clients, as well as employ talented bankers in the country. “Although we have already established a track record through our representative office, RMB Nigeria enables us to significantly scale up our in-country offerings and play a more prominent role in the growth of the Nigerian economy. Potential investors need a reliable, on-the-ground financial services partner who understands the unique challenges and regulatory framework of doing business in Africa.”
RMB Nigeria provides the full spectrum of investment banking services to all industries, including corporate advisory, equity capital markets, infrastructure and project finance, resource finance, structured trade and commodity finance, and fixed income, currency and commodity services – making it one of the leading financial and business partners on the continent.
RMB said it has a strong track record of operating across the African continent. Many infrastructure development projects, cross-border transactions and property and structured finance deals in over 30 countries have been completed over the past two decades.
RMB added that it has already concluded several deals in Nigeria, including ExxonMobile Nigeria (US$50m), Conoil (US$40m) and Africa Finance Corporation (US$50m). It also acted as co-financial adviser for the US$350m Lekki Epe Expressway in Lago (awarded the Euromoney Project Finance Deal of the Year in 2008).
“Our track record and long-standing partnerships are proof of our capabilities and appetite for business in Africa,” says RMB Nigeria chief executive Michael Larbie. “Our knowledge of local financing requirements, legal and jurisdictional frameworks, together with the expertise and balance sheet of FirstRand, enables us to service the rapidly expanding Nigerian economy.”