How 2 Friends Set Up GT Bank 27 Yrs Ago

• The Story Of FOLA ADEOLA & Late TAYO ADERINOKUN

Many customers of GT Bank don’t know how their darling bank was set up by 2 friends. Even those who are not customers don’t know that the big institution you see today was formerly Guaranty Trust Bank before it transformed to GT Bank about 8 years back.

City People can tell you all these for free. The success story you see today was the handiwork of two friends who are accountants, Fola Adeola who was the pioneer MD and his friend Tayo Aderinokun, also an Accountant, who was the pioneer DMD.

Do you know that when Fola Adeola, and his friend Tayo Aderinokun were setting up the bank in 1990, they could not raise the required funding for take-off? No   investor was willing to touch them. Young entrepreneurs also turned down their offer to be part of the dream. They were all scared of investing in this 2 young men and their dreams. Most of  them didn’t quite think the idea would work, despite the fact that the banking boom was in full bloom then. It was with considerable difficulty that they raised the required N20 million to float the bank.

27 years after, the story is different. Today, many of them are regretting it as other share- holders are smiling to the bank. Then, the two men were the toast of every young banker. Their careers suddenly became the envy of other bankers. They were then seen as role models. They were every banker’s dream. They were young and  pro-active. They exemplify the benefits of a liberalised banking environment. They also typify the profile of the rising crop of professionals in Nigeria’s private sector who by dint of hard work and experience have found themselves atop impressive financial empires. Theirs is a generational statement, that all hope is not lost.

It is a tribute to their efforts that an idea which started with an initial capital of N25 million, was transformed into a N5 billion within three accounting years. This is because GTB’s success story is not unconnected with the quality of the banking experience of these two whizkids and their go-getting spirits.Its unfortunate that one of them is no more. Tayo died a few years back.But Fola has kept the flag flying.

Fola Tajudeen Adeola, a Chartered Accountant, worked in D.O Dafinone and Co, a firm of Chartered Accountants, and has several years of banking experience in NAL Merchant Bank and Continental Merchant Bank, his last place of work before he left to start Guaranty Trust Bank in 1990. As for Tayo Aderinokun, a graduate of Business Administration from the University of Lagos and an MBA from UCLA, his working experience took him through Continental Merchant Bank: (formerly Chase Merchant Bank) where he met Fola, Prime Merchant Bank and was Managing Director of First Marina Trust Limited (a finance company) before leaving to join Fola in crystallising the idea of establishing a standard-setting commercial bank.

What further precipitated the setting up of GTB in 1990 was Fola Adeola’s frustrations at Continental Merchant Bank. Having been frustrated at the inadequate opportunities to develop himself at Continental, he turned to Chief Wole Adeosun (his old boss at NAL) who was at that time at the helm of First Bank. Adeosun arranged for him to meet some top First Bank management staff so as to share his thoughts with them. It was the failure of this meeting to point in the direction of career fulfillment that stimulated contemplation of the possibility of a banking  licence, a source explained.

Right from the outset when the bank was being packaged at the NAL Training School, where for weeks the full complement of take-off staff huddled trying to blend and to jointly invent the future of GTB. Till today, a key survival strategy that the bank has stuck to is service.

In a 1993 corporate review document, the bank declared: “Our strategy hinges on an unwavering commitment to customer satisfaction. This is a competitive advantage”. According to Fola Adeola in a recent interview, the key object of procedure for them was to identify customer need and to stubbornly pursue whatever it would take to deliver customer satisfaction. Among the pillars of the capacity to deliver services to meet and surpass customer expectation were technology, people and ambience coming together in the right way.

On Technology, the criteria for evaluating the appropriateness of choice of technology were cost effectiveness, local familiarity with-the technology, security in the system, and robustness. This eliminated cutting edge technology in favour of one which was robust enough to deliver the speed that would allow a cautious team to deliver prompt service.

On People, the emphasis was on bringing together people who had not been contaminated by extant practices in other banks. Fresh and bright young people with a craving to excel were sought for.

On The Ambience, a preference was shown for a earth-friendly environment.  Late Tayo Aderinmokun once recalled that they knew what they wanted: to be a leader in customer service. But they had no iron cast strategy of how they would compete beyond putting the three pillars of technologist people and ambience together and driving themselves relentlessly to overcome all odds. They had one thing going for them: they felt they could do it. They felt they could perform better than Nigeria International Bank, but they still did not do any formal industry structure analysis. They also did not identify a clear-cut niche in the market they wanted to fill, although their experiences and exposure had provided an idea of areas they looked forward to cash in on. One of such niche markets was in service to financial institutions. They had viewed with reservations, the high cost of transactions for financial institutions which often were in need for quick credit and paid a lot of money in COT charges with every transaction.

They thought that if they could get instant value and if they could pay less on COT, that could be a profitable market niche. Beyond this niche market, they looked elsewhere, especially to wholesale commercial banking, often referred to as the high networth individuals market. On the corporate aspect, tile)’ made forays into markets nobody gave them a chance to go for at the beginning. A good example of this is the Aviation market which they marketed aggressively.

In going after the markets they had targeted, they harped on the importance of building long-term relationship which they did with the way the bank managed its allocation of foreign exchange to its customers. Although criteria such as Turnover with the bank were sometimes used, GTB’s management recognised early

enough that the benefits of charging a premium would be shortlived and might negatively affect long term relationships. It avoided that widespread practice.

Thus, GTB’s Corporate Strategy could not have been more timely in a pre-90’s banking climate that paid  attention to customers service and satisfaction. Then, it would take a minimum of 9 hours to cash a Nl,000 cheque from the bank. It was not surprising therefore that promising service delivery (in respect of,

withdrawal and deposits) that will not last more than a maximum of 15 minutes was bound to be a success story.

When Guaranty Trust opened its doors on August I, 1990, they did not just  make promises, they actually fulfilled these promises. Unparalled customer service flowing from the three pillars of technology, people and ambience of their headquarters in Victoria Island, was on display – from the very first day. To reinforce this culture that emphasized customer service was a unique style of leading by example. Both Fola Adeola and Tayo Aderinohm made a point of leading from the front-line by being rostered to routinely work as tellers across the counter. This emphasized the team spirit they sought to encourage and it was an opportunity for management to gauge customer satisfaction. The point GTB management sought to send across was that in their new bank, the Customer is King. They share the credo at H.B. Fuller, the century old adhesives maker. that customers are first, employees second, shareholders third and the community fourth. The limits of the personal touch-customer-service was further stretched in the early days of the bank when the Chief Executive, Adeola, designated himself the Chief Customer Service Officer with his telephone extension available to customers, This was the much talked about Formula 201, a form of complaints desk. All the dissatisfied customers needed to do was dial extension 20 1 from any of the bank’s phone boxes, and was on to the  MD.Add that to the elegant and soothing banking environment (the green plants, marbles and chandeliers). The bank’s operation were also fully computerized which allowed for the on-line teal time mechanism. It was a complete package.

Added to this was the encouragement the GTB management gave to initiative by empowering them to go the extra mile where meeting customer needs was involved. Where any staff exhibits such initiative the bank’s management made a point of celebrating it, like an incident in which a customer needed special attention on a public holiday.

According to the: story which is common knowledge within the: bank, the: customer wanted to withdraw N4.5 million in cash on this public holiday and he managed to reach his account officer at home. The officer was met just as he was about to leave with his family for picnic. After listening to the customer’s plight as to why he needed to, withdraw such a substantial sum  money that day the Account  Officer cancelled his outing, reached his boss and others who controlled access to the bank’s strongroom. They all met at the bank a few minutes later and money was retrieved from the vault and safely delivered to the customer, the: risk of moving around such huge cash notwithstanding. Predictably all these flexibilities. .and customer satisfaction have: made customers come flooding in, so much so that at a point it became a fad to open an account at GTB.

While rewarding customers for their patronage; through service delivery, not only customers were rewarded, Others involved with the bank have: been rewarded in one form or the other especially those involved financially through deft management and aggressive: profit chase, the bank has been ahead of its peers in its six year history and the shareholders have been the better for it. Until it threw its shares open to the public.

It is a tribute to the role of the two partners who set up GTB that under six years, the bank  blazed a trail in respect of revolutionizing the banking environment with Quick and Prompt Service. With the result that the bigger banks like First Bank, Union Bank and UBA have seen themselves having to respond to quick customer service to avert shifts in deposits. This becomes more real in view of the generational differences between the old-generation depositors who constitute a large maker for the old generation banks and the new crop of young entrepreneur and businessman requiring fast service             from their banks. While the very big banks can rely on their sheer size to withstand any shock, all other banks have had to respond positively to the challenges created by the service-oriented banking environment arguably typified by Guaranty Trust.