Nigeria's naira devaluation risky for foreign currency loans, says report
Published 09 Dec,2020 via The Nation - The devaluation of the naira against global currencies will impact negatively on foreign currency loans and weaken capital base for the lenders, banking sector report has shown.
The Afrinvest Banking Sector Report for 2020, which was released yesterday, said the capital base of the Nigerian banking sector has also come under pressure due to the adoption of International Financial Reporting Standards (IFRS 9). The harsh operating environment resulting in higher non-performing loans and significant write-offs also did not help the lenders.
Also, due to the naira devaluation and weaker asset quality, industry Capital Adequacy Ratio is being pressured in the short term.
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Collins Nweze