2022 Banking Industry Report

Overview of the Report

Agusto & Co.’s 2022 Banking Industry Report is the most current and comprehensive report on the banking industry in Nigeria. The report provides an overview of the banking industry’s architecture and an in-depth analysis of its asset quality, earnings, capitalisation and liability generation. Our assessment of the Industry’s financial condition is based on figures and information published in the approved annual reports of eighteen commercial banks, five merchant banks and two non-interest banks as at 31 December 2021.

The Nigerian banking industry was impacted by the changes in the macroeconomic conditions in the financial year ended 31 December 2021. Although the pandemic-related headwinds have abated to an extent, the heterodox regulatory practices and insecurity issues remain. Furthermore, the forthcoming elections and growing budget deficit have forced the FGN to modify several extant tax legislations, which would have a significant influence on the banking industry. Nevertheless, the financial services industry’s (dominated by the banking sector) contribution to the country’s GDP has been resilient, rising year on year by 70 basis points to account for a higher 3.5% of Nigeria’s GDP in 2021. The Industry’s resilience is supported by a dynamic structure as more banks transit to a holding company structure which permits DMBs to diversify into other forms of businesses whilst exercising control over subsidiaries. The African Continental Free Trade Area (AfCFTA) is also another vital prospect for Nigerian banks given that financial institutions with a strong capital base and efficient network across the continent are essential for the full implementation of AfCFTA. Agusto & Co.’s 2022 Banking Industry Report include an analysis of the following:

  • the size and structure of Nigeria’s banking industry
  • impact of the CBN’s heterodox policies on the Industry
  • available opportunities and challenges that banks are contending with
  • Industry trends
  • a comprehensive review of the Industry’s financial strength
  • a detailed analysis of the merchant bank segment and non-interest banks’ financial condition performance
  • our outlook for the Nigerian banking industry

Key benefits of the report include:

  • an overview of the Nigerian business environment and how it affects the Industry’s performance
  • an assessment of the changing dynamics in the Industry’s payment systems and overall digitalisation drive
  • a comprehensive review of the Industry’s financial strength
  • a review of the Nigerian business environment and the impact of recent trends on the banking industry.