Commercial Banking

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The provision of tailored banking products and superior service to our valued customers is the top priority of the Business Development Group at Wema Bank.

What We Offer

Overdraft and Credits
An overdraft (OD) is a line of credit that allows a customer to issue series of cheques greater in value than the prevailing account balance. Its use is typically restricted to working capital requirements. Consequently, an OD may fluctuate and periodically move into credit position, in concert with the business cycle. It is an open credit which may be used repeatedly until the balance on the account reaches a certain pre-arranged limit coincidental upon a repayment date, usually one year.

Drawing against Uncleared Effects
Occasionally, a customer might seek temporary accommodation to overdraw an account with the Bank against a pending instrument in clearing. For specific accommodations not supported by confirmed drafts, adequate security shall be taken for such requests, for a maximum tenure of 30 working days.

Salary Advance
Our Salary Advance is a salary-based overdraft facility not exceeding 30% of an eligible customer’s net monthly salary. This is open to staff of private companies, government agencies and other salaried workers who operate accounts with Wema Bank.

Direct Credit
We offer instant credit to bank customers whose lodged cheques may still be in clearing. This facility is offered based on account performance and credit history.

Revolving Credit
This short-term facility is typically structured whereby the customer repays each drawing within a specified time frame, usually from 30 to 180 days. However, the customer has the option to re-borrow up to the limit of the facility. The revolving credit is usually extended to finance a company’s permanent working capital, although the tenor of the facility must not exceed three (3) years.

Warehouse Financing
This form of financing involves the bank taking notional physical control of the goods it is financing. In reality, physical control is usually expedited by an independent third-party warehousing agent. Warehouse financing is most appropriate in situations whereby the item being financed is the principal support for the facility. Moreover, easily disposable products with fast conversion cycles, either as raw materials or finished products, are more suited to this form of financing.

This facility can be a one-off transaction with a maximum tenor of 12 months, or revolving with a tenor of up to three years. Where a Warehouse Financing arrangement exceeds 12 months, physical stock-taking is conducted to confirm that the quantity of the items in stock tallies with the warehouse warrants in the Bank’s custody, and that the quality of such items has not deteriorated. Release from stock is usually on First In, First Out (FIFO) basis to ensure that the stock in the warehouse is replenished.

Contingent Liabilities
Performance, Advance Payment, Bid Bonds and Guarantees. These are undertakings by the Bank (made at the request of our customer to a beneficiary) whereby the customer carries out the terms of a contract with the beneficiary. Failing this, and upon presentation of predetermined documents within stipulated periods, the beneficiary will be compensated by the Bank to the extent of the agreed undertaking. These instruments are known as contingent liabilities, whereby the Bank substitutes its credit for that of a client.

NOTE: We will only issue such instruments when we have full cash collateral or a counter-indemnity from a first-class bank, or another acceptable security. Multinational companies that normally borrow clean or against negative pledge may, however, be accommodated without providing cash collateral or third-party indemnity. Nevertheless, they will be required to sign and issue a Letter of Indemnity to the Bank.

Letters of Credit
Customers request the Bank to issue, on their behalf, Letters of Credit to their overseas suppliers to facilitate the importation of goods and services. Almost all Letters of Credit are irrevocable; that is, they cannot be amended or cancelled without prior agreement of the beneficiary, the issuing bank or the confirming bank.

Bankers’ Acceptances (BA)
Bankers’ Acceptances are trade bills stipulating a commitment to pay. They are usually between 30 and 180 days in tenor, and are drawn on and accepted by banks on behalf of their customers. The bills can be sold to a third party usually at a discount. By accepting the bill (signing “Accepted” on the bill), the accepting institution guarantees payment of the bill. These instruments are offered to clients to finance imports of raw materials, or local orders with a short turnaround time. The facility is usually revolving and available for periods not exceeding 12 months. Typically, the credit line is available on a standby basis to fund a pre-approved transaction.

Invoice Discounting/ Receivable Refinancing
Wema Bank can discount customers’ invoices up to 70% of the value. This can either be with recourse or without recourse.

Relationship Management
At Wema Bank, building long-lasting relationships with our customers is an enduring corporate goal. We promise to always listen carefully and commit ourselves fully to adding qualitative value towards our customers’ business success. In addition, our experienced Business Development Managers are available to offer support and business advice.

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October 21, 2016