Banking sector’s total assets to hit N44.2trn, loans N16.1trn by end 2019

Banking sector’s total assets are expected to hit N44.2 trillion by the end of 2019, according the banking sector report by Afrinvest West Africa launched on Monday in Lagos. This figure represents 7.8 percent increase compared with N41.0 trillion in 2018.

At the end of the first half of 2019, the sector recorded N43.7 trillion in total assets, the report said.

“Total assets remain strong,” said Ike Chioke, group managing director, Afrinvest West Africa, while presenting the report with the theme ‘Beyond the Precipice…Pulling Back from the Brink’.

The industry’s total deposits are expected to reach N29.1 trillion by the end of 2019, growing at 25.4 percent as against N23.2 trillion in 2018. Total deposits stood at N25.6 trillion in the first half of 2019.

The report showed that the total loan of the banking sector stood at N15.7 trillion in the first half of 2019 and is expected to hit N16.1 trillion by the end of the year.

Charles Soludo, former governor of the Central Bank of Nigeria (CBN) and current member of President Muhammadu Buhari’s Economic Advisory Council, noted there was massive transformation compared with the numbers before banking sector consolidation.

“In subsequent ones, let us look at where we are in terms of the depth of the banking relative to, even in comparison to Africa. I checked banking by asset size, percentage of GDP, I was struck as to how low we are even by African standard,” Soludo said.

“Countries like Mauritius, Kenya, Senegal, Ghana and several others were much higher. That might have some implication about saving the banking financial system and the kind of economy we want to be able to empower,” he said.

Speaking further, Soludo said, “We had a dream of Nigeria becoming the African banking and financial centre. Now that we are actually integrating Africa to have Africa Continental Free Trade Agreement as it were, what kind of banking and financial system do we really need to be able to move the economy forward?

“The question is, what should be the next level for the banking system and what should be the kind of disruptive change or changes that need to be adopted to be able to move the sector to that level that it is able to power the Nigerian economy and increasingly African economy?”

Soludo expects the subsequent Afrinvest banking sector report to show the kind of banking sector to be seen in the next five to 10 years.

“I think it might be one way of pushing us in the direction of the further reforms and further changes, especially disruptive changes. I like the concept of disruptive changes. You can’t repeat the same thing over and over and expect a different outcome,” he said.

Cost of governance, education, e-voting, sub-national revenue generation and other issues topped discussion at the panel session at the Afrinvest conference. Personnel expenditure is expected to hit N2.3 trillion by the end of 2019, which is 71.2 percent growth to revenue.

Others who spoke at the panel session include Foluso Phillips, executive chairman and founder, Phillips Consulting Limited, Andrew Nevin, partner and chief economist, PwC Nigeria, Fatumata Soukouna Coker, founder, Ygroup Holdings and chairman, Afrinvest Securities Limited, and Tola Adeyemi, partner, KPMG.

 

HOPE MOSES-ASHIKE