Nigeria Fidelity Bank seeks loan growth as treasury yields fall

Nigeria’s Fidelity Bank expects loans to grow at a faster pace this year than the 7.5 percent it forecast for 2017, helping lift profits after Treasury bills yields fell, an executive said on Monday.
Nigeria, which emerged from its first recession in 25 years last year, has been working to lower its costs by borrowing abroad to redeem local debt, forcing local treasury yields down.
It redeemed 130 billion naira (307.76 million pounds) in treasury bills last week and paid off 198 billion naira bills in December, leading to rates dropping by around 300 basis points.
Fidelity Chief Operations and Information Officer Gbolahan Joshua told Reuters banks expected their net interest margins to fall to 5 and 6 percent due to the drop in treasury yields, which he said meant banks needed to boost lending this year to lift income.
Net interest margin at Fidelity was 6.4 percent in 2016, while analysts said it was 6.5 percent for the sector.