Exotix Limited, a United States registered broker and member of FINRA and SIPC has endorsed Zenith Bank Plc, Access Bank Plc and United Bank for Africa Plc among the top five Nigerian lenders worthy of investment. Exotix noted that the said banks are good buys due to their valuation and growth potential.
Kato Mukuru, an analyst at Exotix Frontier Equities, said in an email note to clients, “We strongly believe that now is the time to have a strong bias towards Nigerian banks. Nigeria also offers something few sub-Saharan African banking systems can hope to offer – scale.”
London-based Exotix, which started building an African equity team last year, noted that with loan penetration increasing only 5 percentage points over the past 10 years in Nigeria, the potential for asset growth in the country is probably much larger than in other parts of the continent.
But Zenith Bank Plc may improve its return on equity to 22.4 percent by 2017 from the 19.6 percent that Nigeria’s third-largest bank by market value reported last year, Exotix said.