Mayowa Kuyoro’s Post

Our 2023 Global Banking Annual Review found that Interest-rate increases by monetary authorities across the world provided the biggest tailwind for the global banking industry in more than a decade with banks globally reaping a US$280 billion profit boost in 2022.   Africa’s banking sector echoed this performance, generating $22.3 billion in net profits in 2022, with an average growth of about 8 percent annually since 2021. Africa also outperformed the global trend with ROE of 15 percent recorded in 2022 and 16 percent in 2023, with some African banks amongst the most profitable. Higher interest rates across most of the continent ended years-long trend of margin compression.   Download your copy of the report here: https://mck.co/45sIoBx   #McKinseybanking #banking #BankingTransition #McKinseyAfrica

Bank profitability in SEE-5 is set to remain at record-high levels in 2024 as well, before starting to moderate (to still above historical average) levels from 2025 onwards. Read the SEE-5 Banking Sector Overview 2023 & Outlook Report covering Romania, Bulgaria, Serbia, North Macedonia & Albania, published by the Emerging Markets Research, Economic Analysis Division of NBG. #NBG #BankingToday #NBGinsights

Did you know the oldest non-foreign bank in the Middle East only opened in the 1920s (the Bank Melli Iran, established in 1927)? While that may not sound like that long ago, can you imagine how much change they’ve seen since they unlocked their doors for the first time less than 100 years ago? Even in the last few years, the banking sector has experienced numerous shocks, including the COVID-19 pandemic. But the GCC has proven remarkably resilient to these shocks. My colleagues’ latest article explains why this is - but, for me, three reasons spring to mind: 1. They’ve developed open-banking frameworks that promote innovation and strengthen internal competition 2. Robust funding has poured into the fintech sector helping to make the population more tech-savvy 3. Many incumbents are launching new digital-first businesses to enable them to access new markets and opportunities, and this investment in innovation has been key. Now, it’s important to say that resiliency is not a given. Just because GCC banks have ridden recent economic storms doesn’t mean they’ll do this in the long-term. Only by continuing to ride the digital transformation wave can these banks ensure continued growth. You can read the full article from Alberto Alvarez and Kishan Shirish here: https://lnkd.in/dC7GsSbk #McKinseyDigital #GCC #Banking #MiddleEast

Exciting news for South African banking! According to BusinessTech, South African banks are on a positive trajectory. Read how they‘re navigating challenges and driving growth in the financial sector. 📈 FNB South Africa #fnb #banking #channels #SouthAfrica

[Working Paper Alert] Title: Bank business model identification, evolution, and outcomes: evidence for South Africa Authors: John O S Wilson, Linh Nguyen, Anna Sobiech and Lechedzani Kgari Click here, to read the paper: https://bit.ly/440UMJV Abstract: This paper presents the findings of an investigation of the type, evolution, and impacts on the performance of bank business models in South Africa. We identify the various business models used by South African banks using data on the monthly balance sheets of commercial banks made available by the South African Reserve Bank between 1993 and 2022. We cluster banks into different business models based on the composition of their balance sheets. Based on these clusters, we identify business models oriented to wholesale and retail funding, as well as to universal, investment and interbank activities. Overall, our clustering exercise returns six distinct business models. We observe large differences in terms of business size, performance and risk profiles across the business models. We also analyse the evolution of business models over time. The results suggest that banks exhibit relatively stable business models, but where transition exists it tends to be between certain business models. Increased risk is associated with a higher probability of banks shifting business models. (The views expressed in this working paper are those of the authors and do not necessarily represent those of the South African Reserve Bank or South African Reserve Bank policy.)

Banking in Africa: Opportunities and Challenges in Volatile Times (Thorsten Beck, Robert J. Cull, Davide Salvatore Mare and Patricio Valenzuela) Policy Research Working Paper #10632, The World Bank Abstract: This paper surveys existing literature and data to take stock of the current state of banking systems across Sub-Saharan Africa. It documents different dimensions of the development of the banking systems in the region and compares Africa’s banking systems to those of comparable low- and lower-middle-income countries outside the region. The paper also discusses the progress in policies and institutions underpinning financial deepening and the results of specific innovations to reach traditionally unbanked segments of the population, such as innovative branch expansion programs, mobile banking, and new financial products. In view of the COVID-19 pandemic, the paper discusses government support for financial systems and banking sector performance during crises. Overall, the survey shows a picture of achievements and challenges, with progress along some fronts but other challenges persisting even as new ones arise, including the turning of the global financial cycle in 2022/23 and increasing geopolitical tensions. Link: https://lnkd.in/e4-cvEiU

STANDARD BANK: TAKING CHARGE Standard Bank is Africa’s largest bank by assets, serving an active base of close to 19 million clients. The recent euphoria over the Government of National Unity (GNU) election outcome presents a positive outlook for Standard Bank, and the banking sector alike. In this week’s Intuition, James Clark gives an update on this fundamentally strong banking operation. Read more at https://lnkd.in/dKsbaEpc #HarvardHouse #intuition #investments #sharemarketnews #financialplanning #StandardBank #marketupdate

In the third installment in my series on Sub-Saharan Africa's (#SSA) banking landscape, I delve into the performance of the region's #banking sectors. Discover which markets are surging ahead and setting the pace, and which are struggling to keep up. I look at banking indicators on a regional basis, as well as delving more deeply into the ten largest sectors, which we forecast will account for a staggering 76.9% of total regional banking assets in 2024. Check out the full article here: https://lnkd.in/e35gCriH #BankingTrends #FinancialAnalysis #SubSaharanAfrica #EconomicInsights #BMI

In recent years, African banks have undergone a remarkable transformation, challenging the traditional dominance of European financial institutions. Over the past two decades, they have expanded their reach and influence. Africa’s population and economy have surged, creating a strong demand for financial services. African banks, armed with local expertise, understand the unique challenges within the continent. They tailor solutions to meet the diverse needs of businesses and individuals. Policies encouraging local banking and reducing reliance on foreign institutions have played a pivotal role. Moreover, African banks have embraced digital innovation, leapfrogging traditional banking models. Mobile banking, fintech solutions, and digital payment platforms have revolutionized the industry. Implications for Businesses and Capital Markets: >> Businesses: Increased access to credit and tailored financial solutions empowers local businesses. Improved risk management practices enhance stability. >>Capital Markets: Growing African stock exchanges facilitate capital raising. Investor confidence in the region has soared, attracting both local and global investors. Banks also play a vital role in funding critical infrastructure projects. Attracting Foreign Investment: African banks act as conduits for foreign capital. Their efficient financial intermediation supports cross-border trade and investment flows. The continent’s growth potential appeals to global investors seeking emerging markets. Challenges and Opportunities Ahead: >>Risk Management: Balancing growth with prudent risk practices is crucial. Infrastructure Gaps: Addressing deficits in physical and digital infrastructure remains a priority. >>Regulatory Harmonization: Coordinated regulations across borders ensure stability and investor confidence. #oacadvisory #banking

Thailand’s banking sector faces lingering asset-quality risks, but these are unlikely to impact banks’ standalone credit profiles significantly in the near term. Learn more: https://ow.ly/7XQx50Suh1U Visit our website for more Thailand insights: https://ow.ly/yPJy50Suh1X #asiapacific #thailand #banks #assetmanagement #credit