Nigeria’s Diamond Bank to sell off West African units

Diamond Bank

As the crash commodity prices weigh on African countries, Nigeria’s Diamond Bank is one of the many investors who is looking at reducing their exposure to the continent.

Diamond Bank said it is looking at the selling of its West African units to focus on Nigeria, where it already has about 15 million customers.

Uzoma Dozie, chief executive of the bank, said: “After 18 years of building the Diamond Bank franchise in other markets in West Africa, the time has come to fully apply our resources to Nigeria.”

The bank has just disclosed that it is offloading its Benin, Togo, Cote d‘Ivoire and Senegal to a Cote d‘Ivoire-based financial services company Manzi Finances S.A. for EUR61 million.

In its nine months financial result which was recently released, Diamond Bank reported recorded 68% increase in profit to NGN5.9 billion compared to NGN3.5 billion recorded same period in the year 2016. However, impairment charges were still high at NGN35.0 billion against NGN40.2 billion posted in the fiscal year 2016.

The bank’s asset also depleted further from NGN1.9 trillion for the period under review compared to NGN2.0 trillion.

The decision is expected from Diamond Bank and its tier 2 banks who are pressed down by a higher impairment and heavy non-performing loans in their books.

Nigerian lenders have also in recent times relied solely on treasury bills to reduce their loan exposure while issuing Dollar denominated debt notes, a move Fitch Ratings warned has its unintended consequences.

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