Nigerian Banks - Resilience built in
By Guy Czartoryski
Coronation Asset Management today releases its report on Nigerian Banks “Nigerian Banks, Resilience Built In”. The report shows that Nigerian banks’ earnings have been remarkably resilient over the interest rate cycle, their profitability is improving over time and their stock values are remarkably cheap compared to Ghanaian and Kenyan bank stocks.
Our 10-year study of Nigerian banks shows that their Net Interest Margins and spreads are remarkably resilient over the interest rate cycle, while their profitability is improving over time. In a year of fluctuating interest rates like 2021 this provides investors with a degree of confidence about future earnings.
Nigerian bank stocks are cheap relative to their own history, with a median price to earnings ratio of 2.5x in prospect for 2021. And they are cheap compared with Ghanaian and Kenyan bank stocks.
The report features six listed Nigerian banks: Zenith Bank; GT Bank; Access Bank; FBN Holdings; UBA, and Stanbic IBTC with forecasts, stock recommendations and price targets for each one.
Other topics examined are the long-term growth record of Nigerian banks and the competitive challenge of Fintech.
To get the full report, please click the link below.