Business
New regulations may impact growth in Nigerian bank sector
The largest banks already seem to be withstanding the headwinds and expanding their reach in the region and beyond.
Guaranty Trust Bank (at position 24 of the top 200 African banks) announced plans to buy a 70 percent stake in Fina Bank in Kenya in July, and First Bank is looking for opportunities.
Others, like United Bank for Africa (at position 19 of the top 200) and Access Bank (at position 23 of the top 200), are disposing of assets abroad.
There is some downward movement on interest rates among banks operating in the Union Economique et Monétaire Ouest-Africaine (UEMOA), thanks to competition by banking groups challenging “the old guys – BNP, Citibank, Société Générale and Standard Chartered”, says Magatte Diop, chief executive of the US- and Senegal-based Peacock Investments.
The arrival of Moroccan banks such as Attijariwafa Bank (position 7 of the top 200 African banks) and Banque Centrale Populaire has driven activity. Lenders talk about risk factors pushing up interest rates, particularly for small and medium-sized enterprises (SMEs), but the rates are not justifiable.
Senegal is under-banked, as is Côte d’Ivoire (Ivory Coast), with penetration rates hovering between 15 percent and 20 percent in Senegal, however, the situation is changing as growth rates are rising and people are earning more.
Source: The Africa Report
