The Lion King | 13
Ask the Executive
Describe yourself in a sentence
I am self driven, motivated, absolutely
devoted to my family and a bit of
a feminist with a strong belief in the
empowerment of women and provision
of a supporting work environment for
women to flourish both on the job and
in their domestic lives.
What does your role as Divisional
Head, Power, Infrastructure and Project
Finance entail?
I am responsible for the origination,
structuring and execution of Power and
Infrastructure transactions. In this role,
I am primarily responsible for develop-
ing the bank’s portfolio for Power and
Infrastructure Assets and defining the
bank’s local and regional strategy for
the power and infrastructure sector.
How would you describe your job?
Very exciting; I get an adrenaline rush
every time I successfully close on a
transaction. These are very interest-
ing times in the industry particularly in
Nigeria. There are tremendous oppor-
tunities for UBA to distinguish itself as an
industry leader with a demonstrated
understanding of the power and infra-
structure sector.
Your career seems to have accelerated
at an early stage. How did you climb
the corporate ladder so fast?
I was fortunate enough to start my
professional career at an early age.
Starting on Wall Street and getting an
MBA also helped put me on an accel-
erated career track.
What was the motivation behind the
bank’s financing of power sector infra-
structure in Nigeria?
The Bank identified the power and infra-
structure sector as an emerging market
with strong revenue potential. Power
will play a key role in the growth of the
Nigerian economy. Conservatively, the
power sector is expected to add an
additional 3.5% to GDP when it takes
off fully.
The World Bank estimates that a 1%
increase in a country’s infrastructure
stock leads to a 1% increase in the level
of GDP. Clearly, the multiplier effect
of infrastructure stock will be higher in
countries that are starting from a low
base. This has been demonstrated by
the transformation of the telecommuni-
cation sector in Africa.
With weak public sector finances,
particularly in the developing world,
private capital will need to play a larger
role in infrastructure financing if devel-
opment is to keep pace with demand.
UBA, as a bank with revenue growth
aspirations, power and infrastructure
sector will create a reliable stream of
income from the long term assets.
What has been our post-deal experi-
ence so far and what are the expected
benefits from this to our operations and
business?
Our post deal experience has been
very positive. We were very strategic in
the selection of transactions we partic-
ipated in and ensured the transactions
were structured appropriately. The
expected benefit to our operations is a
reliable stream of income from the long
term assets created.
Are we looking at doing some power
deals in other African countries?
Yes, we are. Power and Infrastructure
have been identified as precursors to
the much needed growth in Africa. The
World Bank estimates that Africa needs
to invest about $93 billion annually to
close the infrastructure gap.
Only about $25-billion annually is being
spent on capital expenditure currently,
leaving a substantial shortfall that has
to be financed. UBA has an unparal-
leled advantage due to its presence
in 19 African Countries. There are
several deals we are evaluating at the
moment. It is, however, absolutely criti-
cal that we are satisfied with the deal
appraisal before we decide to finance
the transaction.
What are the major challenges in infra-
structure financing in Africa?
The key challenge is funding. African
governments have historically financed
a sizeable share of the continent’s
infrastructure development from their
annual budgets; infrastructure rollout
has thus been constrained by budget-
ary restrictions.
Another major challenge is the appar-
ent deficiency of traditional financing
sources. Successful infrastructure financ-
ing requires long term sustainable debt.
Most banks in Nigeria are commercial
banks, so this presents a huge asset-lia-
bility mismatch.
There is also a strong need to diversify
the available sources of funding by
developing domestic and regional
capital and debt capital markets and
boosting public-private partnerships
(PPPs).
These markets are generally not well
developed in Africa, outside of South
Africa, although that is slowly chang-
ing. Countries like Nigeria, Kenya and
Ghana have recently seen substantial
growth in their capital markets.
Finally, a lot of projects tend to be
overly complex and could end up
being white elephant projects. As part
of the project selection methodology,
infrastructure financiers need to be able
to unbundle complex programmes to
improve infrastructure portfolio and
project selection.
Which is more challenging; making the
deal or managing the deal?
I would say it is more challenging
managing the deal. Most power and
infrastructure transactions are long
tenured transactions and anything can
go wrong over the life of the deal.
The power sector in particular has a
strong influence from the regulatory
bodies that are constantly coming
up with policies that could affect the
operations of players in that sector. It is
absolutely critical to keep abreast not
only of the transaction and the client
but also industry as a whole.
Sustainable financing is a major
consideration in infrastructure financing
globally. What other considerations
influence UBA’s decision to finance
certain projects?
The primary consideration is the banka-
bility of the project. It is very important
to fully dimension the risk attached to
the project life cycle and ensure these
risks are well mitigated. We also take a
critical look at the quality of the project
sponsors and the ability of the project
sponsors to service the debt obligations
in the unlikely event the project suffers
any hiccups. Due to the infancy of infra-
structure finance development in the
country, we try to avoid non-recourse,
or limited recourse based financing.
We also evaluate the technical
feasibility of the transactions. These
evaluations entail evaluating the quality
of the EPC Contractor and Operations
and Maintenance contract/provider.
Additionally, we consider the impact of
political risk on the project.
Finally, the availability of credit
enhancements such as a Partial
credit and risk guarantees help lever-
age resources in order to mobilize
private-sector financing and facilitate
the flow of investments to non-sover-
eign projects. One of the key selling
points in the current Nigerian power
sector reform is the availability of the
World Bank Partial risk guarantee.
Any words of advice for youngsters
looking up to you for motivation?
It is important to stay focused on your
goals. Do not be ashamed to ask for
help along the way. Ensure you have
the right support structures and network
in place and always have a fall back
option!
