While South African lenders continue to dominate the top African positions in The Banker’s Top 1000 World Banks ranking, domestic economic pressures, combined with the worst outbreak of Covid-19 on the continent, have hit the country’s lenders hard. After posting gains across the board in 2019, just three of the country’s seven lenders in this year’s rankings saw an increase in their Tier 1 capital position in 2020, as higher impairments took their toll on balance sheets.
Standard Bank consolidated its position as the continent’s largest lender — a position it has held for more than 20 years — with a 5.8% gain in its Tier 1 capital base, the only one of the country’s big four to record such an increase. While impressive in the circumstances, Standard Bank slips five places in the overall Top 1000 to 157th place.
FirstRand and Absa Group remain in second and third place in the continent, their Tier 1 capital base dropping by 15.5% and 2.1%, respectively.
Lenders in Nigeria suffer a similar fate in this year’s rankings, as the continent’s largest economy briefly entered recession in late 2020 ahead of a recovery in oil revenues towards the end of that year. Zenith Bank, the country’s largest lender, exits the continent’s top 10 for the first time, following a 5.4% decrease in its Tier 1 capital base. First Bank of Nigeria, the country’s fifth largest lender, was the only one of six Nigerian banks in this year’s Top 1000 to improve its Tier 1 capital position.
Despite such decreases, Nigerian banks continue to score highly for profitability and efficiency compared not only with their African peers but also the global competition. Guaranty Trust Bank, United Bank for Africa and Zenith Bank top the continent in terms of return on capital, coming in fourth, 16th and 22nd positions globally.
Egyptian lenders continue to account for the bulk of Tier 1 capital growth across the continent. All seven Egyptian banks in this year’s Top 1000 registered an improvement in their Tier 1 capital base, and all climbed up in the overall rankings.
National Bank of Egypt overtook South Africa’s Nedbank to become the continent’s fourth largest lender, and climbed 22 places to occupy 215th position in the Top 1000. Local rival Banque Misr records the continent’s best growth, with a staggering 84.2% rise in its Tier 1 position. This rise, a gain of 94 positions in this year’s Top 1000, makes it the sixth highest mover in this year’s overall rankings.
North African lenders make up eight of the continent’s highest movers, highlighting the region’s growth profile compared with sub-Saharan economies. Morocco’s Attijariwafa is the pick of the region’s non-Egyptian lenders, its Tier 1 capital position improving by 15.7% in 2020.
