Nigerian Banks Are Faced With Difficulties Due To Currency Crisis, Inflation and Rate Hikes – Fitch.

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According to Fitch, Nigerian banks would undoubtedly be influence by the naira’s persistent depreciation. Widespread inflation, currency devaluations, and interest rate increases are the causes of this.

It is likely that Nigeria, a nation that depends largely on imports and whose banking sector is extensively dollarize, will experience increase import prices as the value of the dollar rises; making it challenging for corporate borrowers to pass these costs on to customers.

Currency shortages will certainly directly affect Nigerian banks and increase the likelihood of failure on loans made to small businesses.

Dissanayake stated during a press briefing that regional banks are to maintain profitability in the face of medium-severity shocks; but growth potential would be in limit during the next 1-1/2 years.

Nairametrics.

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