VFD Group Targets Commercial Banking Licence

VFD Group Plc, the investment holding group that recently bought the single largest equity stake in Nigerian Exchange (NGX), plans to acquire a commercial banking licence and take a major stake in an insurance underwriting firm as part of an ambitious medium-term plan.

Speaking at a breakfast meeting with strategic stakeholders in Lagos, Group Managing Director, VFD Group Plc, Mr. Nonso Okpala, said the group remained focused on implementing a medium-term plan that would leverage its balance sheet to more than N500 billion.

VFD Group owns a microfinance bank-VFD Microfinance Bank and loan-investment firm – VFD Bridge as well as strategic investments in a mortgage bank- Abbey Mortgage Bank. It also has strategic investment in an insurance brokerage firm-Atiat Insurance Broker among others.

He outlined that the group will be scaling up its direct participation in the banking sector through acquisition of a commercial banking licence and acquire strategic stake in an insurance underwriter as part of efforts to build an African global one-stop financial services powerhouse.

According to him, the group plans to enhance its global status by opening operations in four additional countries over the medium term.

He added that one of the group’s ambitions is to own a strategic stake in an Exchange, which allows the group to bring its bespoke managerial and governance model to bear on such Exchange.

Okpala said the group would have over the medium term acquired enough global recognition to enable it list its shares on major across the world.

He noted that the group is building an investment holding firm with a whole ecosystem that benefits several value chains across countries and continents.

According to him, VFD Group is symbolically a diverse array of businesses presenting diverse opportunity for partnerships and collaboration.

“The investments we have made underline our commitment towards creating innovative and accessible solutions for the everyday Nigerian and entrepreneur,” OKpala said.

He outlined that the group’s investment consideration for any business is guided by a strict set of predetermined objectives including profit, high leverage, ecosystem fit and cash flow.

“We will focus on investing in businesses that have a proven track record and can guarantee a steady income. We will focus on investing in businesses that have high leverage capabilities, and whose balance sheet can provide benefit across the ecosystem.

We will focus on investing in businesses that complement our ecosystem, thereby maximizing overall synergy. We will focus on investing in businesses that would give us access to long-term cash flow, Okpala said.

He said the group has started replicating its business VFD model across selected geographies guided by a defined strategy driven by innovation and market expansion.

“We have began establishing our footprint outside of the market and we will continue to explore offshore investments that align with our ecosystem build,” Okpala said.

He outlined that the group with presence in United Kingdom, Nigeria and Ghana, plans to establish operations in United States, Netherlands, Kenya, Zambia and South Africa over the medium term.

According to him, founded in 2009, VFD Group is building a sustainable ecosystem by exploring new markets and businesses that will aggregate viable investment for its partners, consistently collaborating and improving its capital market businesses through its portfolio companies, expanding cross-border investments and partnerships to gain significant foothold beyond the Nigerian market and by establishing presence in every sector of the financial services across – banking, insurance, asset management and investment banking among others.

“We are a proprietary investment company focused on building positive and socially conscious ecosystems by aggregating potentially viable businesses with the objective of creating innovative products and solutions

“Our business model allows us to operate in major sectors of the economy through our portfolio, providing financial advisory, asset management, currency, real estate, debt services and private funds management services, taking deposits and providing loans at very competitive rates.

“Looking ahead, our investment focus will center around five pillars= banking, infrastructure and energy, real estate and hospitality, technology and capital market,” Okpala stated.

VFD Group was recently named as ‘2021 Most Innovative Investment Company in Nigeria’ by the International Finance Magazine (IFM).

IFM, a business and finance magazine published in the United Kingdom, awarded VFD Group at the 2021 International Finance Award held in Dubai. VFD Group was chosen as the winner over three other major nominees.

According to IFM, the award recognised the VFD Group’s industry talent, leadership skills, industry net worth, and capability on an international scale, as well as the VFD Group’s previous accomplishments.

With this award, VFD Group joins the list of previous award winners from Nigeria, which included Zenith Bank, FBN Insurance, Stanbic IBTC, GTBank, and other leading companies and players in the country’s financial sector.

Director, International Finance Magazine, Sunil Bhat said VFD Group was chosen after considering nominations by a research team, based on VFD Group’s strength of application, accomplishments, innovation, and good governance.

The Nation had reported exclusively that VFD Group Plc, an indigenous investment group, had acquired the largest equity stake of 5.17 per cent in NGX Group, the holding company for Nigeria’s main securities exchange, Nigerian Exchange (NGX) Limited and the leading clearing house, Central Securities and Clearing System (CSCS) Plc.

VFD Group described the acquisition of the single largest equity stake in NGX Group as a strategic decision to be a key player in the securities exchange business.

Okpala had said the acquisition was in alignment with the investment group’s strategic vision of building Africa’s first diverse business ecosystem.

According to him, the investment in the pioneer exchange company of Nigeria was a strategic play in the group’s ecosystem build, an investment philosophy that ensures the group drives global prosperity by investing in businesses that have potential, helping them maximise their potential and supporting the platform that can help portray them to the world.

He said the investment in the NGX Group as the exchange company of choice was due to the wide range of services offered and how the NGX has been positioned for growth.

He noted that the NGX Group is a leading integrated market infrastructure in Africa, that services the largest economy in Africa and is strengthening the competitiveness of African economies to achieve global prosperity.

He added that as a key player in the continent’s financial markets, NGX plays an active role in shaping the future of the markets through its investment in business innovation and technology.

“Our interest in the NGX is borne out of our desire to be a key player within the exchange business in Nigeria, contribute to the deepening of the Nigerian capital market and be a catalyst for capital formation within the Nigerian economy.

“With over a decade of operations, VFD Group has carved a niche for itself with over N50 billion in equities invested in over40 businesses without bias for sector or geography and we believe that our stake in the NGX will improve investor confidence in our country, drive capital appreciation and diversify our asset class,” Okpala said.

NGX Group provides a wide range of services including listing and trading securities, licensing, market data solutions, ancillary technology, regulation and real estate among others. It has three wholly-owned subsidiaries – NGX Exchange, NGX REGCO, and NGX RELCO. NGX Group also has controlling stake in CSCS and substantial stakes in other securities exchanges including FMDQ and NASD Plc.

May 05, 2022