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UPDATE 1-Nigeria's FCMB targets loan growth of 10-14% this year

Published 05/05/2020, 17:22
Updated 05/05/2020, 17:24
© Reuters.

© Reuters.

(Adds quote, details)
By Chijioke Ohuocha
ABUJA, May 5 (Reuters) - Nigerian mid-tier lender FCMB
FCMB.LG said on Tuesday it is targeting loan growth of 10% to
14% this year as the impact of the coronavirus pandemic prompts
healthy companies to increase credit facilities in order to
weather the crisis.
That would be well down on 29% growth in gross loans last
year but Group Chief Executive Ladi Balogun was upbeat.
"We expect loans to remain robust," he said.
"What we are seeing is that there's going to be more credit
requirement as a result of covid-19 for those companies that are
healthy and can justify the need," the CEO said on a call with
analysts.
Balogun said the bank will lend to top quality names within
the consumer goods sector and small businesses. The bank also
expects credit to agriculture, manufacturing and healthcare
sectors to grow.
On Tuesday, Nigerian officials said they expect the economy
to shrink by 3.4% this year as dwindling oil revenues and the
impact of the coronavirus force the country to cut budget plans
for a second time. Nigeria, which has recorded 2,802 cases of the coronavirus
and 93 deaths, began to ease a nationwide lockdown on Monday
after four weeks.
Balogun said economic recovery will require a rise in oil
prices but the bank's loan growth will be driven by customers
investing in anticipation of the recovery. He expected that
interest rates will go up due to higher credit demand.
FCMB said it was restructuring half of its loan portfolio,
in line with leeways allowed by the central bank and the
accounting standards body during the pandemic. It expects the
restructuring, targeted mostly at the oil and retail sectors, to
be completed within the next two weeks.
Shares in Lagos-listed FMCB rose 4.29% on Tuesday to 1.69
naira.

($1 = 360.00 naira)

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