Nigerian bank mergers 'may boost access to finance'
Access to finance for Nigerian consumers could be improved if mergers and acquisitions deals currently being negotiated in the country are completed.Access to finance for Nigerian consumers could be improved if mergers and acquisitions deals currently being negotiated in the country are completed.
According to Afrinvest, completion of the agreements will push the combined market share of the five biggest banks in the country by asset value to 57.6 percent, up from 51.2 percent, the Moment reports.
Access Bank and Intercontinental Bank are expected to combine, giving them a total market share of 9.8 percent, while Ecobank Nigeria and Oceanic Bank International are also set to merge.
Cowry Assets analysts said in a report obtained by This Day that confidence in the banking sector will improve if the deals are completed and the increased financial capability of such institutions may enable them to offer more finance to customers.
However competition may suffer if mid-market banks find they are unable to match products provided by larger competitors.
As of December 2010, Nigeria's four largest banks - Zenith Bank, Guaranty Trust Bank, First Bank of Nigeria and United Bank for Africa - accounted for 49 percent of loans and advances in the country.