NIGERIAN BANKS MAINTAIN STRONG POSITION DESPITE CURRENCY CRISIS: ANALYZING THE 2024 AFRICAN BANK RANKINGS
Despite Nigeria's ongoing currency devaluation and economic difficulties, the country’s banks have demonstrated resilience, achieving high rankings in two key assessments of African financial institutions.
Key Highlights:
1. Nigerian Banks Shine in Top 100 Rankings: Nigerian banks ranked prominently in the 2024 African Business Magazine and The Banker's top 100 lists.
Eight Nigerian banks made African Business Magazine's list, with First Bank of Nigeria leading the Nigerian contingent, ranking 15th overall with a capital base of $1.9 billion.
Other top-performing Nigerian banks include Access Bank and Zenith Bank, ranked 16th and 17th, respectively.
2. Strong Performance in The Banker’s List: The Banker listed nine Nigerian banks, placing Nigeria second after Egypt, which has ten banks on the list.
Among Nigerian banks, UBA saw an improvement, moving from 19th place in 2023 to 18th in 2024. Zenith Bank, however, dropped from 10th to 14th.
3. Impact of Currency Depreciation: The Nigerian naira's depreciation against the US dollar affected banks' valuation in the rankings. Since banks report their figures in local currencies, the conversion to USD resulted in lower asset values, affecting 52% of the regional banks on the list.
4. Regional Overview: South Africa's Standard Bank Group remained the top bank in Africa, with Egyptian and Moroccan banks also showing strong performances.
The report noted that, despite challenges, profitability has increased across the sector, with banks showing an 18.2% pre-tax profit growth.
5. Challenges Facing African Banks:
Broader economic challenges, such as the lingering effects of the Ukraine war and continued currency depreciation, have affected the performance of lenders in South Africa and Nigeria.
In contrast, banks in Morocco and Egypt have managed to counterbalance the regional difficulties.
Conclusion:
Despite the ongoing currency crisis and broader economic challenges, Nigerian banks have maintained a strong presence in African banking rankings, with several institutions demonstrating resilience and profitability. However, the impact of local currency depreciation continues to pose challenges, as seen in the asset valuations and tier 1 capital for many of the banks listed.
Despite Nigeria's ongoing currency devaluation and economic difficulties, the country’s banks have demonstrated resilience, achieving high rankings in two key assessments of African financial institutions.
Key Highlights:
1. Nigerian Banks Shine in Top 100 Rankings: Nigerian banks ranked prominently in the 2024 African Business Magazine and The Banker's top 100 lists.
Eight Nigerian banks made African Business Magazine's list, with First Bank of Nigeria leading the Nigerian contingent, ranking 15th overall with a capital base of $1.9 billion.
Other top-performing Nigerian banks include Access Bank and Zenith Bank, ranked 16th and 17th, respectively.
2. Strong Performance in The Banker’s List: The Banker listed nine Nigerian banks, placing Nigeria second after Egypt, which has ten banks on the list.
Among Nigerian banks, UBA saw an improvement, moving from 19th place in 2023 to 18th in 2024. Zenith Bank, however, dropped from 10th to 14th.
3. Impact of Currency Depreciation: The Nigerian naira's depreciation against the US dollar affected banks' valuation in the rankings. Since banks report their figures in local currencies, the conversion to USD resulted in lower asset values, affecting 52% of the regional banks on the list.
4. Regional Overview: South Africa's Standard Bank Group remained the top bank in Africa, with Egyptian and Moroccan banks also showing strong performances.
The report noted that, despite challenges, profitability has increased across the sector, with banks showing an 18.2% pre-tax profit growth.
5. Challenges Facing African Banks:
Broader economic challenges, such as the lingering effects of the Ukraine war and continued currency depreciation, have affected the performance of lenders in South Africa and Nigeria.
In contrast, banks in Morocco and Egypt have managed to counterbalance the regional difficulties.
Conclusion:
Despite the ongoing currency crisis and broader economic challenges, Nigerian banks have maintained a strong presence in African banking rankings, with several institutions demonstrating resilience and profitability. However, the impact of local currency depreciation continues to pose challenges, as seen in the asset valuations and tier 1 capital for many of the banks listed.