Standard Bank doubling up in West Africa

Standard Bank plans to double its West African business through 2030 as Africa’s biggest lender seeks to capitalise on economic reforms and faster growth in Nigeria, Ghana and the Ivory Coast.

The bank wants its earnings from the region, currently roughly half the size of its South African operations, to grow to about the same scale as its home market, said Luvuyo Masinda, its head of corporate and investment banking.

“One of the things we will want is for this West Africa region to be as quickly as possible the same size as the South African business,” he said in an interview.

“If you speak to the teams here, they have an ambition to double this business in the next four years.”

Nigeria, which is West Africa’s biggest economy and the continent’s most populous nation, is attracting investors into its abundant natural resources and infrastructure sectors, after reforms in the foreign-exchange market, macroeconomy and energy industry boost investor confidence and unlock value in the country’s assets.

The same prospects seen in Nigeria are replicated in the Ivory Coast — one of the region’s fastest-growing economies — and in Ghana, which is recovering from a 2022 to 2023 sovereign debt default and is seeing stabilising inflation, lower interest rates and a steadier local currency.

Standard Bank has headroom to grow by tapping the opportunities opening in West Africa, according to Masinda. 

“When we think about our own business as Standard Bank Group, we believe we are slightly sub-scale for the opportunities that exist in this market,” he said.

The lender wants to invest in and structure deals in the region’s power, renewables, ports and hard infrastructure sectors.

This will be done by taking advantage of the parent’s balance sheet and accessing global capital through offices in New York, Dubai, London and Beijing, Masinda said. 

It’s also looking to make new hires in the region and leverage fintech to grow retail and small- to medium-sized business clientele, he said.

Outside West Africa, Standard Bank is targeting growth in countries including Kenya, Angola and Egypt, Masinda said. 

Improved regulatory environments in nations with floating, transparent exchange rates and predictable monetary policy are attracting financing and private equity. 

“It’s happening not just in Nigeria, it’s happening in a number of other countries,” he said. “That, more than anything, is attractive to capital.”

There are “quite a lot” of initial public offerings in the pipeline across retail, fintech, telecommunications, and infrastructure, but some IPO processes have slowed due to changing valuations, Masinda said.

He added that conflict in the Middle East “doesn’t help because it alters prices and it delays, it makes people less confident.”