From The Report: Nigeria 2017
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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.