The London-based subsidiary of Nigeria’s Access Bank is opening a new office in Dubai, the lender’s first in the Middle East, its chief executive has confirmed.
Access Bank UK’s new branch in Dubai is located within the Dubai International Financial Centre and will be formally inaugurated next month.
Initially, the Dubai unit will be a marketing office, staffed with two and will highlight the opportunities and services that can be provided out of Access UK, Jamie Simmonds told Gulf Business in an exclusive interview.
“We are seeing an increasingly strong handshake between the United Arab Emirates and Africa – in particular Nigeria. Last year, Nigeria emerged as the 24th largest economy in the world and in 2013 surpassed South Africa to become the largest economy in Africa,” he said.
“There is that natural affinity between Dubai and the expansion into the African corridor. And we, as a fully licensed independent subsidiary in the UK with a parent bank in Nigeria, can unlock opportunities for businesses and people who want to invest in Nigeria and surrounding countries,” he added.
Although Nigeria’s economy primarily depends on the services and agricultural sectors, the third biggest contributor to its gross domestic product (10-12 per cent) is the oil sector.
Nigeria is the eighth largest oil producer in the world and saw oil revenues of $88bn in 2014. However, the International Monetary Fund (IMF) has warned that the oil price slump will severely affect Nigeria and has predicted that the country’s oil revenues will drop by almost 41 per cent to $52bn in 2015.
Simmonds admits that the recent drop in oil prices has had an adverse impact on the country. “But you can take two views – the doom and gloom view or the view we have, which is that as the government has to retreat to a degree on infrastructure projects, it is liberalising some of the opportunities in investments.
“So there is a very investor friendly environment at the moment. It is politically stable with the transition from one civilian government to another. Despite oil challenges, we see Nigeria having one of the most favourable investment climates there has been with good returns available,” Simmonds said.
Interest from investors in the Middle East is also strong. “We are seeing much more hard investments on the ground coming in. I wouldn’t say it’s a torrent, but we are beginning to see that.
“That’s why our timing now [to open in Dubai] is very important. Because as we start to see more active interest, we are uniquely positioned to help that investment,” he further stated.
Access Bank UK’s Dubai branch will initially offer only marketing services with everything being booked out of the UK balance sheet. However, going forward, the plan is to expand the offering.
“Clearly there’s a natural momentum that will say that as we build our profile and presence here, there will be a pivotal point where we will want to go for the next level of permissions. Certainly, over time, I would envisage that this will build into a full branch,” Simmonds said.
