An­a­lysts fret Banks’ as­set qual­ity...

Business Day (Nigeria) - - REAL SEC­TOR WATCH -

“From my ob­ser­va­tion in Q4 2018, there has been no sig­nif­i­cant im­prove­ment in the price of oil which is vi­tal to the per­for­mance of the bud­get and the bank­ing sec­tor. Should the trend per­sist in 2019, banks NPL would pile up. How­ever, we can­not be cer­tain for now un­til the re­port for Q4 2018 is re­leased”, Sa­heed added

Busi­ness­day anal­y­sis of the in­vestor re­port of Tier-1 lenders showed that the cu­mu­la­tive av­er­age of NPL ra­tio stood at 8.38% in the first nine months of 2018, an im­prove­ment over 9.00% in full year of 2017.

On the other hand, the cumu- la­tive av­er­age of NPL ra­tio of six Tier-2 lenders im­proved by 2.71% ba­sis points to 7.27% in the first nine months of 2018 from 9.98% in 2017 FY.

The anal­y­sis showed that Ac­cess Bank (4.7%), Stan­bic IBTC (4.7%) and Zenith Bank (4.9%) had NPL ra­tio within the reg­u­la­tory thresh­old of the Cen­tral Bank of Nige­ria, thus re­flect­ing their good as­set qual­ity.

Over­all, the av­er­age NPL ra­tio of 11 lenders cap­tured in the anal­y­sis, im­proved to 7.77% in the first nine months of 2018 as against 9.54% in 2017FY, al­though still 2.77% higher than the reg­u­la­tory bench­mark of the CBN.

Newspapers in English

Newspapers from Nigeria

© PressReader. All rights reserved.