Flush with petrodollars and ambitious plans, Nigeria’s banks are coming to London. Guaranty Trust Bank, one of Nigeria’s leading banks, has just been authorized by the UK’s Financial Services Authority to operate as a bank in the UK. Its subsidiary, GTB UK, which is based in Margaret Street in London, will focus on commercial activity in areas where there are already established links between Nigeria and the UK and the other countries where it operates, including Gambia and Sierra Leone. The subsidiary will provide banking services such as receiving deposits and writing mortgages for both commercial and retail customers and intermediates.
"We are very pleased to be making our first step into Europe with the opening of GTB UK," says Tayo Aderinokun, managing director of GTBank. "We are confident many of our clients will welcome the opportunity to bank with us in London and we are excited about developing further business relationships through our UK subsidiary."
GTBank is one of Nigeria’s leading banks, offering a wide range of financial services and products throughout the country and the West Africa region. Historically, the group has focused its business on large and medium-sized corporate clients. The bank has also moved into the retail sector, building a nationwide network and providing banking services to nearly every segment of the Nigerian economy.
"We are looking at streamlining banking services and fees for our clients," says Ronke Bammeke, managing director of GTBank UK. "Our West African clients will now find it much easier to send payments and do business in the UK than it was before."
Where GTBank goes, other Nigerian banks will not be far behind. First City Monument Bank (FCMB) and Oceanic Bank both have applications pending with the FSA. Both UBA and Zenith Bank have already acquired licences – Zenith opened its branch in London at the end of last year – and other Nigerian banks such as Access are lined up to follow. The stellar performance of the Nigerian banking sector on the country’s stock market is fuelling their expansion plans.
That in turn is being driven by strong credit growth, although in a report last month Fitch Ratings warned about deteriorating asset quality. What is of particular concern to the ratings agency is that credit growth is outstripping increases in deposits. While levels of liquidity are adequate for the time being, Fitch is wary that they could decline if credit growth were to continue at such a strong rate.
Fitch maintains an individual rating of D for Nigeria’s banks.