African banks say it is possible to buy a European bank in next 5-10 years
Two key African banks namely the Ecobank Group and the Standard Bank Group believe that buying a European bank in the next five to ten years is a possibility.
This is in response to a question posed during a panel discussion at the ongoing Euromoney Conference in Accra, Ghana.
Answering the question; “Can an African bank buy a European bank in the next one or five years or never?”
Head of Research at Ecobank Group, Mr Paul-Harry Aithnard said “Yes. In the next five years.”
As a pan-African bank, probably Ecobank will be the first, Aithnard added.
For Mr Alhassan Andani, Managing Director of Stanbic Bank Ghana (subsidiary of the Standard Bank Group), it is very possible for it to happen in ten years time. “Even in Rome, many thought African Bishops cannot be at the Vatican but now they are there teaching bishops in England and elsewhere about the doctrines.”
Another panel member Mr Christian Wessels, a partner at Roland Berger Strategy Consultants in sub-Saharan Africa agreed with the assertions made by Andani and Aithnard.
“Yes. Five years from now,” said Mr Wessels.
But the CEO of Frontier Market Asset Management, Mr Lawrence Speidell disagreed with his fellow panellists.
“It will never happen,” Mr Speidell said.
According to an Economist Intelligence Unit (EIU) report published August 4, 2011, banks in key African economies south of the Sahara are projected to increase their financial assets by more than 150% in the next decade.
The EIU said these countries are poised to enjoy a surge in growth in their banking systems during this decade and describes the development as a ‘boom’.
The report, “Banking in sub-Saharan Africa to 2020 Promising frontiers,” indicated that “high rates of economic growth, financial deepening to fulfil huge unmet needs for basic financial services and new technologies to provide them—particularly over mobile phones” are the three main drivers of this development.
Giving two scenarios – exclusive economic expansion and both economic growth and financial deepening, the Unit said “In the conservative scenario, driven exclusively by economic expansion, we project that the industry in 16 key African economies will boost its financial assets by 178% to $980 billion by 2020. In the more likely scenario, driven by both economic growth and financial deepening, we foresee assets expanding by 248% to $1.37 trillion at the end of the decade.”
The countries to enjoy this surge are Ghana, Nigeria, South Africa, Tanzania, Angola, Botswana and Namibia, Senegal, Mozambique and Uganda, the Unit noted.
By Ekow Quandzie