Agusto & Co. has predicted that more bank customers would embrace digital banking platforms which could result in higher electronic banking income for the financial institutions.
The pan-African ratings agency stated this in its latest banking sector report.
According to the Lagos-based firm, the full impact of the COVID-19 pandemic on the industry would be difficult to measure in the near term.
It stressed that, these are indeed difficult times for the industry that barely recovered from the recession. But, it noted that despite various identified risks, opportunities exist in the sector.
“For instance, working capital needs of companies in key economic sectors will increase because of the naira devaluation and higher inflation, presenting prospects to grow loans to obligors with good business fundamentals in resilient economic sectors.
“We expect more bank customers to embrace digital banking platforms which could result in higher electronic banking income for banks. Furthermore, banks can leverage intervention funds provided by the CBN to susceptible sectors during this pandemic to grow loans. The Nigerian banking industry remains resilient and we expect this narrative to remain,” it stated.
According to Agusto & Co., non-interest income accounts for approximately 42 per cent of the industry’s net earnings, largely driven by electronic banking activities, account maintenance fees, credit related fees and securities trading income.
It pointed out that with the lockdown resulting in skeletal operations, banks have leveraged their electronic banking platforms to boost income as more banking transactions are only consummated through digital channels during the lockdown period.
Source:
Chima noye
The pan-African ratings agency stated this in its latest banking sector report.
According to the Lagos-based firm, the full impact of the COVID-19 pandemic on the industry would be difficult to measure in the near term.
It stressed that, these are indeed difficult times for the industry that barely recovered from the recession. But, it noted that despite various identified risks, opportunities exist in the sector.
“For instance, working capital needs of companies in key economic sectors will increase because of the naira devaluation and higher inflation, presenting prospects to grow loans to obligors with good business fundamentals in resilient economic sectors.
“We expect more bank customers to embrace digital banking platforms which could result in higher electronic banking income for banks. Furthermore, banks can leverage intervention funds provided by the CBN to susceptible sectors during this pandemic to grow loans. The Nigerian banking industry remains resilient and we expect this narrative to remain,” it stated.
According to Agusto & Co., non-interest income accounts for approximately 42 per cent of the industry’s net earnings, largely driven by electronic banking activities, account maintenance fees, credit related fees and securities trading income.
It pointed out that with the lockdown resulting in skeletal operations, banks have leveraged their electronic banking platforms to boost income as more banking transactions are only consummated through digital channels during the lockdown period.
Source:
Chima noye
