Kenya’s banking sector appears to be undergoing some restructuring, as around 1,620 employees of listed banks in the country were let go in 2017. According to a report from Cytonn Investments, jobs were cut following the closure of 39 bank branches across the country during the year. Among the losses are Equity Group, which shed 400 staff; Barclays Bank, 301; Standard Chartered Bank, 300; and KCB Group, 223. Other local banks to experience cuts included National Bank of Kenya (150), First Community Bank (106), Sidian Bank (108) and NIC Bank (32).
The losses were reportedly required due to a tough operating environment that transpired in the wake of the Banking (Amendment) Act of 2015, which introduced a floor on deposit rates of 70 percent of the central bank rate (CBR) and rate caps on loans at 4 percent above the CBR.
Plans have been moving ahead recently to establish a state-owned bank in South Africa. In late April, the country’s Parliament published an invitation to the public in the national gazette to comment on a draft bill proposed by Member of Parliament and Deputy President of the Economic Freedom Fighters (EFF) Floyd Shivambu to amend the Banks Act. The amendment aims to allow the state to register institutions to conduct banking business, which it is currently prevented from doing.
Shivambu reportedly believes that the ongoing process taking place in Parliament will lead to the establishment of a state-owned commercial bank, and also believes such a move will enable the creation of state-owned commercial banks at provincial and local levels. “The current banking infrastructure…has excluded a lot of our people from financial participation,” Shivambu added.
Ghana’s banking regulator is aiming to boost the banking sector following a spate of bad loans and poor governance, which ended up severely restricting availability of credit in the nation. The banking sector is now recovering from a crisis that saw its currency drop significantly in value due to a series of distributors in the energy sector defaulting on their debt and exposing lenders to almost US$3 billion in bad loans in 2016. Now the 35 licensed lenders in the country have until the end of 2018 to raise their minimum capital levels more than threefold to 400 million cedis ($90 million). In turn, the new regulations should spur some consolidation in the industry, resulting in fewer players overall, according to analysts.
Saudi Arabia’s banks are making preparations for more subdued lending growth this year, despite the efforts being made by the government to push economic growth higher. The country launched its Vision 2030 plan back in 2016 as a way to transform its economy, which continues to suffer from the spectre of low oil prices, resulting in a prolonged recession and austerity measures having to be put in place. According to the International Monetary Fund (IMF), the Saudi economy should grow positively by 1.8 percent this year; but bankers are reportedly concerned over shrinking assets, as loans get repaid, but new borrowing opportunities remain scarce. Indeed, many of the local banks to have disclosed first-quarter earnings so far this quarter have reported shrinking loan growth.
Following the US’ exit from the JCPOA (Joint Comprehensive Plan of Action) nuclear deal, Iran’s banking sector could face serious consequences. Already lumbered with mounting bad loans, the banking sector is likely to face further strain, as Iranians had already begun cashing their savings even before US President Donald Trump’s announcement that he would pull out of the deal. According to an unnamed official with Iran’s biggest state-owned Melli Bank who spoke to Reuters, “When there is political uncertainty, its psychological impact on people causes a drop in savings. But it will pass after Trump’s deadline.”
And a senior Iranian central bank official also acknowledged the deterioration in the banking system over the past year, admitting “we have still not passed the danger zone”. That said, the official did say that the central bank has “all the measures ready to prevent any crisis”. Iran’s banking problems have caused lenders in the country to limit lending, which in turn has dried up investment in the country. And although banks re-established relationships with more than 200 international counterparts, the US’ hard-line position on Iran could harm business ties between Iran and other countries, which in turn could spur further deterioration in the industry’s overall loan-quality levels.
Emirates NBD (Dubai)
Best Banking Group KSA
Samba Financial
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SICO
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EFG-Hermes
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GIB Capital
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Standard Chartered Bahrain
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Emirates NBD
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National Bank of Egypt
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Arab National Bank
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National Bank of Kuwait (NBK)
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AMBank
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Bank Muscat
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International Bank of Qatar (ibq)
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Mashreq Bank
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Commercial International Bank (CIB)
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Arab Bank
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Riyad Bank
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National Bank of Kuwait (NBK)
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AMBank
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Dubai Islamic Bank (DIB)
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Al Baraka Bank of Egypt
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Boubyan Bank
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BankDhofar
Nedbank (South Africa)
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Equity Group Holdings
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Ecobank Transnational
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SBM Group
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Attijari Finances Corp
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Exotix
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Banco Angolano de Investimentos (BAI)
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Afriland First Bank
Best Commercial Bank Of The Year Democratic Republic of the Congo
Rawbank
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Dashen Bank
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BICICI
Best Commercial Bank Of The Year Kenya
KCB Bank
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International Bank (Liberia)
Best Commercial Bank Of The Year Sierra Leone
Union Trust Bank Limited
Best Private Bank Of The Year Kenya
Stanbic Bank Kenya
Best Private Bank Of The Year Nigeria
First Bank Private Banking
Best Innovation In Retail Banking Cameroon
Afriland First Bank
Best Innovation In Retail Banking Ghana
Universal Merchant Bank
Best Innovation In Retail Banking Liberia
International Bank (Liberia)
Best Innovation In Retail Banking Mauritius
SBM Group
Best Innovation In Retail Banking Mozambique
Moza Banco
Best Innovation In Retail Banking Nigeria
Keystone Bank
Best Innovation In Retail Banking Sierra Leone
Union Trust Bank Limited
Best Innovation In Retail Banking South Africa
Nedbank
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