World Business

Nigerian bank opens for business

By Zhou Yan (China Daily)
Updated: 2010-06-24 10:27

BEIJING - First Bank of Nigeria Plc (First Bank), the largest commercial lender in the sub-Saharan country, has tied up with China's major State-owned banks to tap into ballooning Sino-Nigeria businesses, the bank's Chief Executive Officer Bisi Onasanya said on Wednesday.

It's also currently in talks with a major Chinese bank on possible equity deals. "The discussion is still in the initial stage," Onasanya said, without disclosing the name of the lender.

First Bank has so far teamed up with some of the country's largest banks, including China Construction Bank (CCB), Industrial and Commercial Bank of China, and China Development Bank, to facilitate Chinese firms' business activities in Nigeria, where China is the largest trade partner, with bilateral trade recorded at $6.37 billion in 2009.

The lender said it's also about to sign a memorandum of understanding (MOU) with the Bank of China soon, after inking a MOU with CCB in 2008 to cover areas including trade finance, foreign exchange transactions and credit lines.

"A lot of major Chinese companies are backed by large State-owned firms, it's important for us to have relationships with these Chinese banks," said Bola Adesola, the lender's executive director.

First Bank, which operates 600 branches in Nigeria, officially opened its first representative office in Beijing on Wednesday. The lender currently runs subsidiaries in London and Paris, and has a representative office in South Africa. An office in the United Arab Emirates is in the pipeline.

"Our role in China is to provide trade financial services, such as equity investment and debt financing, for businesses moving from China to Nigeria, making their investments in Nigeria more smooth," said Onasanya.

Related readings:  Chinese engineers boost Nigeria's roads  Shell suspends production in part of Nigeria  Oiling the wheels of progress in Nigeria  China-Nigeria trade ties continue to strengthen

He also said that the lender will look at opportunities to upgrade its Beijing representative office into a subsidiary subject to government approval and its business performance in the country.

The Lagos-based bank has already managed transactions for some of China's major telecommunications suppliers and infrastructure providers such as Huawei Technologies and China Metallurgical Group Corp, in which First Bank guaranteed to facilitate projects, according to Adesola.

"Our major businesses involving Chinese firms mainly cover the areas of telecom, raw materials, machinery and infrastructure construction," said Onasanya.

Apart from oil and gas exploration in the world's eighth-largest exporter of the two resources, Chinese firms have actively invested in Nigeria's infrastructure segment to boost the African nation's growing economy.

"Chinese businesses have been able to break into Nigeria's market significantly. There's a lot of room for us to grow our business," Onasanya said.