Zenith Bank tops the list of the largest Nigerian banks and comes in as the 7th largest in Africa, according to the latest ranking of the top 1,000 global banks by the influential Bankers’ magazine.
This is as African banks suffered limited upside in this year’s top 1,000 ranking due to the weakness of their currencies, many of which fell sharply against the US dollar in the second half of 2011.
Zenith came in as the top bank in Nigeria with $2.398 billion of Tier-one capital, followed by First Bank at $2.36 billion, Guaranty Trust Bank (GTB) $1.478 billion, Access Bank $1.05 billion, and UBA at $1 billion to make up the top five.
Fidelity Bank, FCMB, Skye Bank, Diamond Bank, and Stanbic IBTC Bank, made up the rest, with Tier-one capital of $867 million, $683 million, $665 million, $587 million and $460 million respectively.
Tier-one capital refers to the core measure of a bank’s financial strength from a regulator’s point of view.
This is the money that the bank has in its coffers to support all the risks it takes, such as lending and trading. These include common stock, disclosed reserves, retained earnings and minority interests in the equity of subsidiaries that are less than wholly owned.
Access Bank’s assets increased 93 percent to $10.3 billion, due to its takeover of Intercontinental Bank.
This led it to move from 805th to 635th in the assets ranking. Ecobank also moved from 609 to 498 in terms of assets, mainly due to its acquisition of Oceanic Bank.
African lenders however did not move up the Tier one ranking significantly, due to local currency weakness.
South African banks were among the hardest hit, with the rand sliding almost 19 percent versus the US dollar last year.
The effects of this can be seen with Standard Bank, which retained its position as the largest bank in Africa by Tier one capital and assets.
Yet while the latter (Tier-one) rose 12 percent in local currency during 2011, assets fell from $201 billion to $183 billion in dollar terms.
This was also largely the reason why Standard Bank’s Tier-one capital decreased from $12 billion to $9.8 billion in 2011, causing it to drop from 94th to 112th in the ranking.
In the regional ranking Standard Bank was the largest Bank in Africa, followed by FirstRand and Ned Bank group (all South African banks), Zenith Bank which was rated as the 322 largest bank in the world, came in at 7th in the regional ranking, closely followed by First Bank at the 8th position.
Nigeria’s Guaranty Trust Bank, with a world ranking of 455, also got a mention as one of the highest upward movers in Africa.
Source: BUSINESSDAY News
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