Banking

Nigeria Banking

Despite the challenges to Nigeria’s economy, many of the country’s banks enjoyed healthy revenue and asset growth in 2016. Asset quality issues continue to hinder the sector, but banks have found avenues outside of lending activities to expand their balance sheets. One area of growth stemmed from the devaluation of the naira in 2016. According to the IMF, 45% of loans held by banks are in a foreign currency. Upon devaluation, the book value of these loans in naira terms grew instantly. Naira devaluation provided a one-off boost to the value of existing assets, but material growth in forex or naira lending is not expected in 2017. The purchase of government securities is providing one of the few significant sources of actual revenue growth in the sector. While the past two years have been challenging for Nigerian banks, there is a sense that the industry has turned a corner, and that conditions are set to improve.

This chapter contains interviews with Godwin Emefiele, Governor, Central Bank of Nigeria; and Godwin Nwabunka, CEO, Grooming Centre.

Previous chapter from this report:
Economy, from The Report: Nigeria 2017
First article from this chapter and report:
Nigeria's banking sector maintains stability and growth
Cover of The Report: Nigeria 2017

The Report

This chapter is from the Nigeria 2017 report. Explore other chapters from this report.

Interviews & Viewpoints

Sketch of Godwin Emefiele, Governor, Central Bank of Nigeria (CBN)
Godwin Emefiele, Governor, Central Bank of Nigeria (CBN): Interview