Most Nigerian lenders have their oil exposure hedged at $40-$50 a barrel, which will mean they would have to make provisions if prices remain where they are, said Emmanuel Adeleke, a banking analyst at ARM Investment Managers in Lagos. He “expects flat growth in earnings for most banks this year.”

What banks are saying:

• Zenith Bank Plc forecasts loans growth of 2% this year versus 22% in the prior year. Deposits will probably increase 2% and profit-before-tax by 4%.
• “We have to be conservative and cautious,” Chief Executive Officer Ebenezer Onyeagwu said on an investor conference call from Lagos last month.
• Guaranty Trust Bank Plc expects profit-before tax to rise 1.4% from 8% in 2019, while loan growth may slow to 13% from 19% last year, the lender said on March 13. The company plans to diversify from banking into insurance and asset management to cushion itself from some of the economic challenges.
• Access Bank Plc will target sectors less exposed to the effects of the coronavirus and the oil industry, the lender said last week. Non-performing loans that were restructured last year will probably start performing in 2020, provided the operations of the companies are not hampered by the virus.