Brands
First Bank of Nigeria
Limited has been named as the most valuable banking brand in Nigeria in The Top
500 Banking Brands of The Banker magazine of the Financial Times and Brand Finance, London, United Kingdom for
the sixth consecutive time.
According to a press
release issued on Sunday by the Country Representative – Nigeria of The Banker
magazine, Mr. Kunle Ogedengbe, First Bank leads four other Nigerian banks in
the global ranking.
With $301 million brand
value, First Bank ranked 357 leads Guaranty Trust Bank ranked 395 with a brand
value of $258 million, Zenith Bank ranked 414 with a brand value of $247
million, Access Bank ranked 476 with a brand value of $182 million and the United
Bank for Africa with a brand value of $172 million ranked 487 in the world.
According to the chief executive of Brand
Finance, David Haigh, the brand value is the amount a third party will need to
pay in using the brand name.
As for the methodology of the ranking, “Brand
Finance employs a discounted cashflow technique to discount estimated future
royalties at an appropriate rate to arrive at a net present value of a bank’s
trademark and associated intellectual property - its brand value”, noted Brian
Caplen, the editor of The Banker.
Caplen stressed that the process involves five
steps of obtaining brand-specific financial and revenue data; modeling the
market to identify market demand and the position of individual banks in the
context of all other market competitors; establish the royalty rate for each
bank; calculate the discounted rate specific to each bank, taking account of
its size, geographical presence, reputation, gearing and brand rating; and
discount future royalty stream (explicit forecast and perpetuity periods) to a
net present value – the brand value.
He noted that the approach is used for two
reasons: it is favoured by the tax authorities and the courts because it
calculates brand values by reference to documented third-party transactions and
it can be done based on publicly available financial information.
Globally, deputy editor of the magazine, Joy
Macknight informed that Industrial and Commercial Bank of China is number one
with a brand value of $47,832 million followed by Well Fargo of the United
States of America with a brand value of $41,618 million.
The top ten banking brands ranking in the
world are shared by four countries: China and United States of America with
four each while United Kingdom and Spain have one each.
The remaining eight banks in the top ten are
China Construction Bank, Chase (JP Morgan & Co of the USA), Bank of China,
Bank of America, Agricultural Bank of China, Citibank (USA), HSBC (UK), and
Satander (Spain) noted Macknight.
In the top 50 countries in the world, only
four African countries made the list. These are South Africa (26), Nigeria
(42), Egypt (46) and Morocco (47).
According to the February 2017 edition of the
magazine, First Bank is however the only Nigerian bank in the top 10 banking
brands in Africa along with nine others banks from South Africa, Egypt and
Morocco.
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