Six commercial banks are likely to seek mergers and acquisitions in the New Year – no thanks to the shock created in their assets and balance sheet sizes in the face of declining oil prices.
The Managing Director, Sterling Bank Plc, Yemi Adeola, disclosed this yesterday, saying that he envisaged possible shrinking in the number of local banks in the New Year, but did not name any bank.
Speaking at an end-of-year media briefing in Lagos, the bank chief said two international banks were discussing with local lenders on possible acquisition. He said the year has been a challenging one for the economy and the banking sector, adding that banks are now finding ways to wriggle out of these challenges, including a tough regulatory environment.
“To say that everything will be rosy in 2016 will be deceiving ourselves. I think if the opportunities arise for banks to pursue further consolidation, we could see two or three. I also know that one or two international banks are interested in pursuing acquisitions in Nigeria and they are indeed having discussions already,” he said. “So, you could see a combination of one or two international banks taking over one or two Nigerian banks or merging with them. And nothing also stops two or three Nigerian banks having merger discussions in 2016.” Adeola said.