Former Group Managing Director of United Bank for Africa and Chairman, Nova Merchant Bank, Phillips Oduoza, speaks about his career, family and other things.
Excerpts:
Having completed your tenure as MD/CEO of UBA, why did you choose to return to banking with Nova Merchant Bank?
Getting a banking licence is not something that is done overnight; it actually takes a fairly long time. I completed my tenure as the MD/CEO of UBA on July 31, 2016, and after that, I took a vacation for about three months. During the vacation, I started thinking of what to do. Initially, my original plan was just to retire and rest.
However, it occurred to me that there are still a lot of things that I have to contribute to the banking industry in Nigeria. I started thinking of what shape the contribution would be but I knew that I wanted to do something new. I also considered the changes going on in the industry globally, especially in the area of finance technology and I felt that Nigeria should not be left behind. I also started thinking of how I was going to use technology to drive activities in the financial services industry. I thought of several sectors and ultimately, I felt that I have done so much of commercial banking; so, I decided to venture into a new frontier, where I can make some significant changes.
That was how I came up with the idea of a merchant bank. I felt that a merchant bank has a very wide scope – from asset management to brokerage business, capital market activities and debt equity capital, among other areas. I decided to venture into this field while maintaining a close link as a deposit money bank. When I got back from vacation, I appointed a consultant and we started putting the ideas together and carving out a business model. It was after building the business model that we got the name for the venture, and it was derived from the way we wanted to operate. We told ourselves that we wanted to bring fresh ideas, new thinking and create new opportunities. That was what led to the name Nova: which means new.
In terms of the licensing, it took a long time. We started the process in the first quarter of 2017 before we could finally open shop at the beginning of this month. In the interim, we set up a project office in Ikoyi, Lagos, which was also the same place I used as my personal office. We employed our first staff members in May, 2017. The first person to come on board was the company secretary, who also doubled as the legal officer to put the legal documents together. We also worked with our consultant and a law firm, Ken Ahia and Associates, to put the structure together and submit our application to the Central Bank of Nigeria. In April 2017, we got the provisional licence, which is called Approval in Principle, and by December 2017, we got the final licence to begin banking activities.
As the Chairman of Nova Merchant Bank, what are your responsibilities?
The role of the board of directors is to have an oversight over the operations of the bank, setting the pace for risk management. The board is also involved in strategy; determining the kind of business and customers the bank wants to do business with. As the chairman of the board, I oversee the board members that are responsible for setting the risk tolerance limit of the bank.
What are the things you considered in choosing the bank’s pioneer staff?
Right from the outset, we decided the kind of business we wanted to build; so, that determined the type of people that we brought on board. We can only hire talents that are suited to merchant bank activities such as wholesale and investment bankers. After our strategy session, we agreed on the profile of the people that we would hire.
The basic consideration is someone with integrity who has the capacity to execute and deliver. The person must also be competent and committed as well as have a track record of having delivered in the past. We didn’t have no-go areas; so, it didn’t matter what the person studied in school. We just needed people that had the passion and ability to do the job. We hired people from law firms, other banks and from different backgrounds. We tried to get the best people.
Currently, there are about five other merchant banks in the country. What will you be doing differently?
We did our research and we felt that merchant banking penetration is still very low in Nigeria. Secondly, we want to be deeply involved in pure merchant banking activities, in the sense that we want to focus on wholesale and investment banking. One of the areas that we have had some challenges in Nigeria is in the area of long-term funding for businesses. We decided that we want to be the catalyst for direct funding flows into Nigeria for long-term lending and we are partnering with development financial institutions to do that. Thirdly, we also believe that a lot of businesses are not in the capital market; therefore, under our advisory services, we want to restructure and take them to the market for them to do IPOs and tap into long-term funding sources. We think we can do this very well and in the process, assist in the economic development of Nigeria.
What were some of the legacies you left behind as the MD/CEO of UBA?
UBA is on a very firm ground today and well diversified. It is a major financial powerhouse on a solid foundation. It is a bank that would go places, beyond the shores of Nigeria.
What do you think are some of the major challenges in the Nigerian banking industry?
One of the major challenges in the industry is getting quality talents. We need to do more by way of training and up skilling the people that we have. We need to diversify the product range that we have in the banking industry. We should also strengthen our risk management approach to business. To a very large extent, we need to do more in the area of deepening relationship management, especially when it comes to the big corporate organisations.
You also served as a director at Interswitch. How did you find the experience?
I represented UBA on the board of Interswitch because at that time, UBA was an investor in the company. Interswitch was owned mostly by banks then and all the banks had representatives on the board of the company.
As an alumnus of the Harvard Business School, how has the knowledge gained from there impacted on your career?
I must say with all modesty that Harvard Business School equips you with the necessary leadership skills and that helped me so much. I did the Advanced Management Programme, which is one of the highest levels of leadership programmes in the institution. I learnt quite a lot from there that transformed my leadership skills.
What are the highlights of your banking career?
I have been in the banking industry for about 30 years; so, it may be somewhat difficult to summarise the highlights. Now that I have moved from being the MD/CEO of a bank to being the chairman of an organisation, it is another challenge. However, I hope to enjoy the experience and I would make effective use of it. For the first time, I am not involved in the nitty-gritty, day-to-day running of the bank; rather, I am at a high strategy level to carry out oversight functions. As a hands-on person, I sometimes miss being involved in the day-to-day operations but I am rapidly enjoying and adjusting to my new position. It has given me the opportunity to do other things.
For instance, I am on the board of the Lagos State Security Trust Fund and I enjoy it because we are working towards the improvement of the security situation in the state. We want to make Lagos one of the safest places on earth. I am also on the governing board of Veritas University, Abuja. That is another kind of experience that I’m enjoying as well. I also want to be involved in some social programmes geared towards assisting the less privileged in society. I also read a lot.
Can you tell us more about the activities of the Lagos State Security Trust Fund?
The primary goal is to make Lagos safe. I want to seize this opportunity to thank the corporate bodies, especially banks that have been providing the funds used to equip the different arms of government in Lagos. LSSTF provides the police with vehicles and various equipment that are used to fight crime. We also support other security agencies like navy with things like gunboats, armoured personnel carriers, bullet-proof vests, among others. It has been a lovely experience and we have been seeing improvements in the security situation in Lagos.
You are a honourary fellow of the Chartered Institute of Bankers. How would you describe the experience?
This is actually one of the reasons I decided not to retire because it involves continuous contributions towards the development of the industry. As a fellow, you are expected to contribute because it is assumed that you have a lot of experience.
What do you think are some of the most important qualities that a leader needs to succeed?
It is very important for a leader to always lead by example. As a leader, you must practise whatever you preach. For instance, when I used to chair management meetings, I desired everybody’s attention so as to keep the sessions short and effective. As a result, I made the rule that mobile phones shouldn’t be brought into the meetings; and that applied to me as well.
Secondly, a leader must be very objective and fair, regardless of whoever is involved. The leader should maintain the same standard across board, and there should be no form of discrimination. Thirdly, to lead effectively, a leader must coach his people; you should not allow your team members to go astray. In doing this, you should tolerate mistakes to an extent in the course of growing. A leader must also be firm; there should be no sitting on the fence. You must make your position clear and known at every time.
Some people have described Tony Elumelu as your godfather. How would you define the relationship between both of you?
We have an excellent relationship. Tony is somebody who is well respected in the industry and we exchange a lot of ideas. He has an eye for identifying talents and he is very thorough. As busy as he is, he pays attention to details and makes sure he doesn’t miss anything. He is a thoroughbred professional and a good leader. A lot of people who have worked with him don’t always want to leave him. He coaches people and is very humble. Despite his position, he didn’t make use of the executive elevator in the office; he preferred to mix with his staff.
Have you ever considered going into politics?
I believe that if you get to the top in whatever field, you should make contributions for the betterment of that industry. You don’t necessarily have to be in government. In my own case, I make my contributions to the banking industry.
At a time, I chaired a sub-committee of the Banker’s Committee, which championed the cashless policy and transformed the payment system in Nigeria. The work of the committee gave rise to the ATMs, POS, BVN, online transfers and other innovations that are available today. I am also currently on the board of the Nigerian Payment System, which is chaired by the CBN governor.
What was the first job you did in your career?
I have never done any other job outside banking. The first place I really worked was Citi Bank, though prior to that time, I had a brief stint with the then International Merchant Bank. From Citi Bank, I moved to Diamond Bank as a pioneer staff and I rose to the position of an executive director. I later went to Standard Trust Bank at the time that it was merged with UBA. I rose through the ranks and I served two-terms as the MD/CEO of the bank before I retired.
Why did you decide to study Civil Engineering?
As a student, I was very proficient in science subjects; so, I could have studied Medicine or any other such course. However, I wanted a profession that is involved in physical activities, as against research. That was why I chose to study engineering because it has physical applications. As a civil engineer, you are involved in building roads, bridges, houses and so many diverse things. It wasn’t until when I was about to graduate from the university that I started thinking of other professions beyond engineering. I thought of accounting and banking before I zeroed in on banking. While studying engineering, we did some courses that were related to business which aroused my interest.
As a first class graduate, one would have expected you to explore a career in the academics?
Like I said, earlier, I didn’t want to be involved in research. I wanted something more practical. It was against that background that I didn’t want to be involved in lecturing. I needed to be on the field.
Engineering is perceived to be a tough course and for you to graduate with a first class, you must have been a bookworm. Is that correct?
I was not a bookworm (laughs). I read a lot but I was also able to have a social life; so, there was a balance. I think it stems from my upbringing because we were taught from an early age that we must work very hard.
What are some of the memorable experiences you can recall of your childhood?
I am from a large family and I grew up in Owerri, Imo State. My mother gave birth to 10 children (six men, four ladies) and I am the fourth child. All of us are now successful in different parts of the world. My parents were disciplinarians, especially when it had to do with education. I was very small in all the classes that I was in; so, I was always scared of bullies.
As a child, I was a little bit rascally and stubborn; I constantly got into trouble with bigger people. However, I also grew up as a very good Catholic and I always tried to be among people that would serve Mass every Sunday. I had quite a number of friends and we used to play soccer a lot. I was very lucky that it didn’t affect my academic work.
What were some of the qualities that your parents inculcated in you that have helped you to be successful?
They gave us a solid foundation. They always drew a line between good and bad, and they mandated us to always stay on the good side. We were taught to be humble, respectful, read our books, shun lies and stealing. Those qualities have remained with me till date.
What advice can you give to young people who want to grow in their careers?
Don’t miss a step in the ladder. Make sure that you get all the relevant experience because every stage is important. Secondly, you must work very hard, no matter how intelligent you are. It is very rare to find a successful person who is not a hard-working person. There is no substitute for hard work.
What schools did you attend?
For my elementary education, I attended St. Kelvins Primary School, Owerri. I proceeded to the Government College, Owerri, for my post-elementary education. I had my tertiary education at the University of Lagos.
How did you meet your wife?
My wife was a banker and we met in the industry. She used to work in the treasury unit of a merchant bank while I worked in a commercial bank.
What attracted her to you?
My wife is very diligent and a hard-working person. She is a very determined woman who always achieves her goals. She is also very domesticated and loves her family. I use her as my mirror because she says things the way they are.
With your busy schedule, how were you able to make time for your family?
I tried to make time but my wife filled whatever gap that was created. When you run a large organisation, you would always be on the move; she took care of the home front whenever I’m away. Whenever I’m around, I stay in my home with my family. I like to eat at home; I rarely dine at restaurants and social functions. My favourite meal is white rice and plantain.
What other interests do you have?
I like to travel and meet people as well as play golf. I also like nightclubbing but I haven’t been able to do that in a while. I have also not been able to spend much time playing golf lately because at this early stage of Nova Merchant Bank, I am quite engaged with its activities.
Some people believe that golf is a technical game that is only enjoyed by the rich. Do you agree?
I don’t think so; it is only in Nigeria that we see it as a game of the rich. People think this way because there are very a few golf courses in the country; people don’t get introduced to the game at an early age. I agree that the game could be technical because for you to play it well, you have to take some lessons. However, if you played tennis or squash before moving on to golf, you are likely to do better in the game. Playing golf is a very good avenue for networking and signing deals.
How do you like to dress?
During the week, I dress in the traditional conservative attire of bankers, which is made up of a white shirt, tie and dark suit. Over the weekend, I like traditional attire. And when I go for less formal functions, I dress casually in T-shirts and trousers. – Culled from Punch.
