The Nigerian banking industry has taken a wider challenge competing with the international banks across the globe. The rating of banks in Nigeria is based on their efficiency in service delivery and being on the lead to control and run modern banking services with flexible network integrations gearing towards serving their customers within and outside the country.
Recently, bank ratings in Africa reported in the Vanguard News online dated January 17th 2012 and quoting Banker magazine which recently retained its world’s number one monthly publication position above Bloomberg Markets, Euro-money and Harvard Business Review by Global Capital Markets Survey through a study by Think Media, an independent company that researches readership of financial publications, revealed that 11 Nigerian banks make top 50 African banks among which include Zenith Bank Plc, FirstBank of Nigeria Plc, Guaranty Trust Bank Plc, Access Bank Plc, UBA, Fidelity Bank Plc, First City Monument Bank Plc, Diamond Bank Plc, Skye Bank Plc, Stanbic IBTC Bank Plc, and EcoBank Nigeria.
Apart from the top playing banks in Africa from South Africa which maintains leadership of the continent’s banking industry, Morocco, Libya and Nigeria made up the first ten banks in Africa and closely followed by Egypt.
In the recent publication by the Banker Magazine the Banker’s Africa Editor, Mr. Paul Wallace disclosed that banks from Nigeria, South Africa and North Africa still dominate the Top 20 with “only one lender, Togo-based Ecobank came from outside of those places” in the Top 20. He further stated that African banks have made tremendous improvements recently. In his speech, Wallace said: “African banks have grown rapidly in the past few years. Based on the 2010 results, nineteen of them have Tier 1 Capital of more than $1 billion, a level that roughly marks the cut-off point for the world’s biggest 500 banks”.
Tier One Capital by The Banker magazine as published in its current edition has 9 Nigerian banks making the list of top 1000 banks globally and the only country with 9 banks leading in the top 25 banks in Africa.
Among the top banks include the foremost Zenith Bank with 296 position and First Bank with 310 position. Others are Guaranty Trust Bank ranked 444, Access Bank (495), United Bank for Africa (513), Fidelity Bank (567), First City Monument Bank (586), Diamond Bank (650) and Skye Bank (657).
Meanwhile, in July 27 2011 the Central bank of Nigeria CBN raised Monetary Policy Rate (MPR) to 8.75 per cent, to further tighten money supply in anticipation of future rise in inflation. The MPR is the benchmark for interest rate in the economy.
The CBN also reported that the nation’s real gross domestic product (GDP) growth slowed down in the first quarter to 6.64 per cent from 7.36 per cent in the preceding quarter, warning that security challenges, infrastructural bottleneck and government spending could undermine investors’ confidence and output growth in the near term.
It is therefore stated as follows:
- Zenith Bank Plc - 1st
- First bank Plc - 2nd
- Guarantee Trust Bank - 3rd
- Access Bank Plc - 4th
- United Bank of Africa - 5th
- Fidelity Bank Plc - 6th
- Diamond Bank Plc - 7th
The rankings are based on the definition of Tier One Capital as set out by Basel’s Bank for International Settlements (BIS) and the object of the survey is to show the banks’ soundness in relation to the Basel requirement of a minimum ratio of Tier One Capital to risk-weighted assets of 4 per cent (increasing to 7 per cent by 2019) and a minimum ratio of total capital to risk-weighted assets of 8 per cent.
