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Financial crisis not in Africa banking system and countries for now —MD World Bank Рas Africa bags the 3rd executive seat at World Bank

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16 years ago

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By Omoh Gabriel
The Managing Director of the World Bank Dr. Ngozi Okonjo Iweala said in Washington on Monday that the financial crisis currently rocking the global economy will not have immediate impact on Nigeria banking system and Africa as the reforms carried out in Africa and the fact that ownership of Nigeria banks is not foreign has helped to limit its impact on the banks. She disclosed that at the board of the World bank “there is going to be an extra seat for Africa countries which means that Africa voice will be heard even more than before since it now has a third chair on the board. I think this is a major positive piece of progress by the world bank and it has received the blessing of the development committee which gives Africa countries more say and I think we should commend the work that has been done by Africa board of governors, Board of the World Bank and Mr. Robert Zoellick President of the Bank in trying to get this through”.
She said “In terms of the Present Financial crisis, the key question is how will this impact on Africa, what sort of impact is it going to have? The first thing to say is of course the effect of the crises are still working themselves out here in the US, in Europe and elsewhere and so it will take sometime before we see the full impact of that even within the countries that are the epic centre of the crisis and then to see what will happen to Africa countries. But one can look at one or two channels where African countries might be impacted.
“I think the first thing is to also remember that before this financial crisis there have been the food, fuel and fertilizer crises. The crisis is not being seen in Africa banking system and countries for now. Those countries that have high micro economic inbalances, those with high current and capital account deficient are the ones that are going to be very careful to take adequate measures because if anything happens they are the ones that will experience greater volatility.
The volume of financial aid coming to Africa may drop as she said “Another is the volume of assistance, and as you saw from the communique of the development committee and from the discussion, there have been a lot said about developed countries maintaining their commitment in Greaniggles to make sure that their pledge does not diminish. As of now they are trailing behind, I think their pledge is that by 2010 $50 billion will be going to Africa but how do they meet up with this commitment. I think we are at about $38billion there is the need for them to keep the pressure on to make sure those aid commitment are met.
“This may be a bit difficult since they themselves are experiencing a squiz due to this crisis. Certainly there is has been great effort to urge them to keep their eye on the board. Africa countries need to do their own bit. You know we also need to make our own effort to continue the reforms. You know that one of the good thing, the reason why Africa countries might not suffer much from this crisis as they could have is because they have been reforming.
“These reforms have led to growth that we have seen so there is need to continue the reform on this part not to go back and say we are not going to continue the reforms we are going to nationalise our banks, no.
“Africa has to continue because it has been delivering growth and will enable government to deliver better services to Africa people. So Africa has to continue the effort ans also see how we can use our resources better and improve tax effort and savings mobilisation”.
She said that Nigeria and other oil exporting countries face the danger of dwindling revenue as the world search for alternative source of energy and must act quickly to diversify their revenue base.
She said “Oil is a very difficult thing to forecast you see the volatility, the movement of oil prices, the trend is down and oil is about $82 a barrel if I am not mistaking this is a far cry from the $147 that we are talking about not so long ago. What does this mean, there is so much volatility in the oil market we do not know where the price is going to, if these developed countries go into recession the demand for oil will fall and that will have an impact on the price unless OPEC decides to restrict supply even more. If you are in that position it means you have to be much more prudent with your budgeting. As you know in Nigeria there is fiscal rule, where the budget is based at an oil price below the prevailing price in the market.
The oil price being used for next year is $62 per barrel, if crude oil price is coming down at $82 you can make your own deduction. Nigeria has to be very prudent because if oil price goes below the budget bench mark then Nigeria will have budget constrains.
The World Bank Managing Director said “Oil exporting countries have to be mindful that alternative sources of energy could be generated and they have to themselves diversify their economic base, that is what it means that if you focus only on one commodity and something hit that commodity you will have a lot of difficulty. They have to focus on: diversifying, that is what Nigeria and other oil exporting countries should be doing, Nigeria has good agriculture, it has to build up the good value chain, it has a strong financial services chain, Nigeria has so many other things such as other minerals, it have not even developed them there is coal I do not know what has become of that. So diversification and prudent management of the resources being generated now and in the past years of oil boom, because you are dealing with a wasting asset that could have a competitive alternative. These are things I would suggest that those countries need to do now”.
She said that at the moment Nigeria has a very healthy reserves, as a result of the fiscal rule put in place by the last administration. Nigeria was able to save so much, Nigeria reserves are at about $64billion right now, unprecedented. I think Nigeria has a healthy situation but Nigeria should not be complacent and pull out all the excess crude revenue saved and start using it not yet, I think the money Nigeria is earning now should be used in a much more broader and efficient fashion.

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Afreximbank successfully closed its second Samurai Bond transactions, raising JPY 81.8bn or $527m

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1 week ago

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November 28, 2025

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African Export-Import Bank said it has successfully closed its second Samurai bond transaction, securing a total of JPY 81.8 billion (approx. USD 527 million) through Regular and Retail Samurai Bonds offerings.

The execution surpasses the Bank’s 2024 debut issuance size, attracting orders from more than 100 institutional and retail investors, marking a renewed demonstration of strong Japanese investor confidence in the Bank’s credit and its growing presence in the yen capital markets.

On 18 November, Afreximbank priced a JPY 45.8 billion 3-year tranche in the Regular Samurai market following a comprehensive sequence of investor engagement activities leveraging Tokyo International Conference on African Development (TICAD9), including Non-Deal Roadshows (NDRs) in Tokyo, Kanazawa, Kyoto, Shiga and Osaka, a Global Investor Call, and a two-day soft-sounding process which tested investor appetite across 2.5-, 3-, 5-, 7-, and 10-year maturities.

With market expectations of a Bank of Japan interest rate increase, investor demand concentrated in shorter tenors, resulting in a focused 3-year tranche during official marketing.

The tranche attracted strong participation from asset managers (22.3%), life insurers (15.3%), regional corporates, and high-net-worth investors (39.7%).

Concurrently, Afreximbank priced its second Retail Samurai bond on 18 November, a JPY 36.0 billion 3-year tranche, more than double the inaugural JPY 14.1 billion Retail Samurai issuance completed in November 2024.

The 2025 Retail Samurai bond also marks the first Retail Samurai bond issued in Japan in 2025.

Following the amendment to Afreximbank’s shelf registration on 7 November 2025, SMBC Nikko conducted an extensive seven-business-day demand survey through its nationwide branch network, followed by a six-business-day bond offering period.

The offering benefited from strong visibility supported by Afreximbank’s investor engagement across the country, including the Bank’s participation at TICAD9, where Afreximbank hosted the Africa Finance Seminar to introduce Multinational Development Bank’s mandate in Africa and its credit profile to key Japanese institutional investors.

MBC Nikko Securities Inc. acted as Sole Lead Manager and Bookrunner for both the Regular and Retail Samurai transactions. Chandi Mwenebungu, Afreximbank’s Managing Director, Treasury & Markets and Group Treasurer, commented:

“We are pleased with the successful completion of our second Samurai bond transactions, which marked a significant increase from our inaugural Retail Samurai bond in 2024, and which reflect the growing depth of our relationship with Japanese investors.

The strong demand, both in the Regular and Retail offerings, demonstrates sustained confidence in Afreximbank’s credit and mandate.

We remain committed to deepening our engagement in the Samurai market through regular investor activities and continued collaboration with our Japanese partners.”

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Ecobank unveils SME bazaar: a festive marketplace for local entrepreneurs

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1 week ago

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November 26, 2025

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Ecobank Nigeria, a member of Africa’s leading pan-African banking group, has announced the launch of the Ecobank SME Bazaar—a two-weekend festive marketplace designed to celebrate local creativity, empower entrepreneurs, and give Lagos residents a premium shopping experience this Detty December. The Bazaar will hold on 29–30 November and 6–7 December at the Ecobank Pan African Centre (EPAC), Ozumba Mbadiwe Road, Victoria Island, Lagos. Speaking ahead of the event, Omoboye Odu, Head of SMEs, Ecobank Nigeria, reaffirmed the bank’s commitment to supporting small and medium-sized businesses, describing them as the heartbeat of Nigeria’s economy. She explained that the Ecobank SME Bazaar was created to enhance visibility for entrepreneurs, expand market access, and support sustainable business growth.
According to her, “This isn’t just a market—it’s a vibrant hub of culture, commerce, and connection. From fresh farm produce to trendy fashion, handcrafted pieces, lifestyle products, and delicious food and drinks, the Ecobank SME Bazaar promises an unforgettable experience for both shoppers and participating SMEs. Whether you’re shopping for festive gifts, hunting for unique finds, or soaking in the Detty December energy, this is the place to be.” Ms. Odu added that participating businesses will enjoy increased brand exposure, deeper customer engagement, and meaningful networking opportunities—making the Bazaar a strong platform for both festive-season sales and long-term business growth. The event is powered by Ecobank in partnership with TKD Farms, Eko Marche, Leyyow, and other SME-focused organisations committed to building sustainable enterprises.

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16 banks have recapitalised before deadline—CBN

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1 week ago

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November 26, 2025

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The Central Bank of Nigeria (CBN) has said that16 banks have so far met the new capital requirements for their various licences, some four months before the March 31, 2026 deadline. The apex bank also indicated that 27 other banks have raised capital through various methods in one of the most extensive financial sector reforms since 2004. Addressing journalists at the end of the Monetary Policy Committee (MPC) meeting in Abuja, CBN Governor Mr Olayemi Cardoso said the banking recapitalisation was going on orderly, consistent with the regulator’s expectations. He said, “We are monitoring developments, and indications show the process is moving in the right direction.” Nigeria has 44 deposit-taking banks, including seven commercial banks with international authorisation, 15 with national authorisation, four with regional authorisation, four non-interest banks, six merchant banks, seven financial holding companies and one representative office.
Cardoso explained that eight commercial banks had met the N500 billion capital requirement as of July 22, 2024, rising to 14 by September of the same year. The number has now increased to 16 as the industry continues to race toward full compliance. He said that the reforms would reinforce the resilience of Nigerian banks both within the country and across the continent. “We are building a financial system that will be fit for purpose for the years ahead. Many Nigerian banks now operate across Africa and have been innovative across different markets. These new buffers will better equip them to manage risks in the multiple jurisdictions where they operate,” Cardoso said. According to him, the reforms would strengthen the financial sector’s capability to support households and businesses. He said, “Ultimately, this benefits Nigerians—our traders, our businesses and our citizens—who operate across those regions. “It should give everyone comfort to know that Nigerian banks with deep local understanding are present to support them. Commercial banks are also creating their own buffers through the ongoing recapitalisation.”
He added that the apex bank considered several factors in determining the new capital thresholds, including prevailing macroeconomic conditions, stress test results and the need for stronger risk buffers. He reassured on the regulator’s commitment to strict oversight as the consolidation progresses. “We will rigorously enforce our ‘fit and proper’ criteria for prospective new shareholders, senior management, and board members of banks, and proactively monitor the integrity of financial statements, adequacy of financial resources, and fair valuation of banks’ post-merger balance sheets,” Cardoso said. He said the CBN remained confident that the banking system would emerge stronger at the conclusion of the recapitalization exercise, with institutions better prepared to support Nigeria’s economic transformation Banks have up till March 31, 2026 to beef up their minimum capital base to the new standard set by the apex bank. Under the new minimum capital base, CBN uses a distinctive definition of the new minimum capital base for each category of banks as the addition of share capital and share premium, as against the previous use of shareholders’ funds.
While most banks have shareholders’ funds in excess of the new minimum capital base, their share premium and share capital significantly fall short of the new minimum definition. The CBN had in March 2024 released its circular on review of minimum capital requirement for commercial, merchant and non-interest banks. The apex bank increased the new minimum capital for commercial banks with international affiliations, otherwise known as mega banks, to N500 billion; commercial banks with national authorisation, N200 billion and commercial banks with regional license, N50 billion. Others included merchant banks, N50 billion; non-interest banks with national license, N20 billion and non-interest banks with regional license will now have N10 billion minimum capital. The 24-month timeline for compliance ends on March 31, 2026. Under the guidelines for the recapitalisation exercise, banks are expected to subject their new equity funds to capital verification before the clearance of the allotment proposal and release of the funds to the bank for onwards completion of the offer process and addition of the new capital to its capital base. The CBN is the final signatory in a tripartite capital verification committee that included the Securities and Exchange Commission (SEC) and the Nigeria Deposit Insurance Corporation (NDIC). The committee is saddled with scrutinising new funds being raised by banks under the ongoing banking sector recapitalisation exercise.

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