[Africa CEO Forum] Dennis Belford: African Banks are increasingly able to compete on a global scale
There is no doubt that African banks are up skilling and dealing with global as well as regional and national banking needs.
Some points noteworthy:
- Kenya has the most advanced mobile banking community in the world with their Central Bank accounting for e-cash.
- A number of African countries have dematerialised stock markets, collateral pools, as well as online money market, Fx and bond trading.
- There are positive signs of the alleviation of poverty for the first time ever in Africa
- Rwanda will be poverty-free by 2018.
- Local banks are becoming national, national banks are becoming regional, and regional banks are becoming global.
- Banks Like Stanbic, Ecobank, FirstBank of Nigeria, GTBank, FCMB, Nedbank, RMB, Barclays, CBA, UBA all have pan African agendas, and most have fund /asset management capabilities. They also have licensed subsidiaries in European countries, China, and the USA, as well as many other states.
- Nigeria already has an OTC market trading in Repos, Bonds and MM. Kenya has similar capabilities.
- South Africa and Nigeria are both involved in the initial stages of providing clearing for derivatives with a CCP.
- Banks across Africa coupled with micro-lenders are coping with African citizens’ needs.
- The number of CDS contracts and infrastructure financing in Africa is reducing as African banks handle larger funding projects from own resources.
In short African Banks are increasingly able to compete on a global scale and are showing greater ROA and better growth than Asia and other parts of the world. The rapid increase in M3 has contributed largely to this as money is channelled through the private sector rather than government to government lending, which is corruption riddled and the multiplier ineffective. (Money velocity stops dead in government).
Oil, agricultural and other exports are becoming better organised, driving real benefit to Africa.