Last week, Fitch, the ratings agency released a 12-page report on 12 of the 23 Nigerian banks.  Here are some of the main points:

1. Excesses that have been built up in the banks in recent years is likely to negatively impact their financial performance for years to come.

2. The economic crisis has taken its toll on the banks but the consolidation exercise of 2005/2006 places them in a better position to absorb ongoing risks.

3. Fitch believes the recent trend of slower credit growth is a positive development.

4. Rapid earnings growth since 2005 masked the increasing levels of risk in the system. Higher impairment charges are expected as the economy slows.

5. Fitch expects that Nigerian banks will need to manage their costs and overhead structures more closely going forward

6. The sector is characterised by weak efficiency ratios which have resulted from an underdeveloped economic infrastructure and because many banks lack operational scale.

You can read the report here http://www.naijalowa.com/fitchs-ratings-of-nigerian-banks/