Access Bank, UBA, Zenith Bank among Africa’s most valuable banking brands
● South Africa’s Standard Bank brand has $1.58bn valuation ● Access Bank leads in Nigeria at $379m
NIGERIA’S ACCESS Bank, along with its African compatriots, Standard Bank, First National Bank, ABSA and some other African leading brands across Egypt, Morocco and Kenya, has been named among the most valuable brands on the continent, according to the latest report by Brand Finance, published in The Banker magazine.
Once a year, leading brand valuation consultancy, Brand Finance, puts 5,000 of the biggest brands to the test and publishes nearly 100 reports, ranking brands across all sectors and countries. The world’s top 500 most valuable and strongest banking brands are included in the annual Brand Finance Banking 500 ranking.
Largely, there are 20 African brands in the ranking, with South Africa dominating the African continent with seven brands, while Nigeria boasts of five brands in the ranking with Access Bank emerging as Nigeria’s most valuable financial institution at $379 million in brand value. It is followed by Zenith Bank and United Bank for Africa (UBA), respectively.
South Africa’s Standard Bank Group was named the most valuable banking brand in Africa following a 26 percent rise in its value to $1.58 billion. The impressive increase saw the banking group inch ahead of its South African compatriot, First National Bank with brand value up 18 percent to $1.58 billion, to claim the title with a margin of just $2 million.
Joining Standard Bank and First National bank at the top of the continental ranking are ABSA with $1.43 billion, Nedbank ($1.018 billion), Investec ($992 million), and Capitec Bank ($625 million), while other brands come from Nigeria with Access Bank, Zenith Bank and UBA; Egypt and Morocco have three brands and Kenya has two brands.
Declan Ahern, valuation director at Brand Finance, said, “Standard Bank’s impressive performance comes off the back of hard work over the past few years, with the brand’s reputation steadily increasing since 2019.
“The new brand positioning “It can be” announced mid-way through 2020, alongside continued diversification and adaptability, has clearly paid dividends. Overall, the performance of African brands has been overwhelmingly positive across the board this year, and highlights the impressive strides made by brands from the continent in recent years.”
The report shows that the brand value of the world’s largest banks grew for the first time in three years by a meagre two percent from $1.36 trillion and, undoubtedly, a positive sign for the industry after it shrunk by two percent at the beginning of 2020 to $1.33 trillion and a further four percent by 2021 to $1.27 trillion caused by economic uncertainty and interest rate movements when the situation was exacerbated by the pandemic, which saw profit and interest rates take a hit.
However, looking at the ranking from a global perspective, the world’s top 500 banking brands have turned the tide on brand value contraction for the first time in three years, observing a nine percent year-on-year brand value growth to reach an alltime high of $1.38 trillion.
Meanwhile, as economies continued to adapt to COVID-19 and economies rebounded over the past year, loan loss provisions were much less significant than initially forecasted by industry experts.
Furthermore, improved digitalisation by banking brands, coupled with strong government intervention and economic recovery around the world resulted in a higher than expected industry profitability in 2021.
David Haigh, chairman and CEO, Brand Finance, said, “As banks continue to battle the fallout from the COVID-19 pandemic, the importance of a solid brand is more significant than ever. Banking products are becoming more commoditised, and banks will need to continue differentiating themselves from other competitors in the market, through the use of their brand, particularly in the face of an emerging threat from challenger brands and decentralised finance in the future.”
Joy Macknight, editor of The Banker said, “Many of the world’s largest banking brands have come through the worst of the pandemic stronger – a testament to the role they have played in supporting the real economy through the past 12 months. Banks’ digital transformation efforts over recent years meant they were able to respond faster to client needs, as well as deliver new products and services, which has boosted banks’ reputations in the eyes of their retail and corporate customers.”
Chinese banks dominate top spot, US trails
On the global scene, Chinese banks remained largely impervious as they maintained the lead in the Brand Finance Banking 500 2022 ranking, accounting for onethird of total brand value and worth a cumulative $454.4 billion while their global counterparts saw drops in brand value over the past two years. Thus, ICBC’s brand value has increased by 3 percent to $75.1 billion, making it the world’s most valuable banking brand again as well as the 8th most valuable brand across all industries in the Brand Finance Global 500 2022 ranking.
Over the past year, ICBC has continued to fare well with consumers and expand its portfolio, opening branches in foreign markets such as Mexico, Argentina, and most recently Panama. ICBC continues to outshine its competitors, holding a healthy brand value ahead of China Construction Bank (up 10 percent to $65.5 billion) and Agricultural Bank of China (up 17 percent to $62 billion), which rank 2nd and 3rd, respectively.
According to Ahern, “Chinese banks have performed extraordinarily well this year, with no signs of growth slowing down for years to come. This was undoubtedly aided by the country’s timely response to the pandemic, which reduced the level of economic disruption observed by its counterparts in Europe and the United States.”
Elsewhere, banks in the United States account for 5 spots in the top 10 and also almost a quarter of the total brand value in the Brand Finance Banking 500 2022 ranking, worth a cumulative brand value of $313.7 billion. Of these 76 brands, Bank of America (up 12 percent to $36.7 billion), Citi (up 7 percent to $34.4 billion), Chase (up 5 percent to $30.1 billion), Wells Fargo (down 6 percent to $30.1 billion), and JP Morgan (up 23 percent to $28.9 billion) have held onto their spots in the top 10 of the world’s most valuable.
Across other regions beyond East Asia and North America, HSBC is the most valuable banking brand in the region with $18 billion value followed by Singapore’s DBS with $8.7 billion leading the way for Southeast Asia. In South Asia, the State Bank of India ranks number one with $7.5 billion while Itau dominates Latin America with a $6.6 billion value. The largest financial institution in the Middle East, QNB has consolidated its position as the most valuable banking brand in the region, observing a healthy brand value growth of 16 percent to reach $7.1 billion.
Kenyan banks join 30 new entrants into the ranking
According to the report by Brand Finance, 30 newcomers have joined the Brand Finance Banking 500 2022 ranking this year, including two African new entrants – Kenyan Equity Group, ranked 338th with a brand value of $388 million) and Morocco’s Bank of Africa, ranked 466th with a brand value of $200 million. Equity Group joins its fellow Kenyan compatriots, Kenya Commercial Bank (366th, brand value $338 million), which itself saw an impressive 61 percent brand value increase this year.
Of all new entrants across all countries, with an eye-watering brand value increase of 181 percent, Cadence Bank has entered the ranking as the fastest-growing brand of 2022, reaching a brand value of $403 million. The US-based bank has recently entered into a merger agreement with BancorpSouth Bank, which held a brand value of $266 million in the 2021 iteration of the Brand Finance Banking 500 ranking.