NIGERIA BANKING SECTOR PROGRESS

Three Nigerian banks out of the 24 banks in the country made the Banker 500 global bank brand ranking 2014. The three banks are First Bank Plc, GTbank Plc and Zenith Bank Plc. However, Ecobank Transnational Incorporated was ranked the most valuable brand in Africa – outside South Africa – in the annual ranking of the global banking and financial magazine ‘The Banker’ in its special edition Brand Finance Banking 500 of February 2014. First Bank of Nigeria Limited, for the third consecutive year was ranked as Nigeria’s number one banking brand in the 2014 Top 500 Banking Brands Ranking of the world just released by The Banker Magazine a publication of Financial Times Group in its February edition and Brand Finance in the United Kingdom. According to a release by the Country Representative– Nigeria, The Banker, Mr. Kunle Ogedengbe, First Bank came top among the Nigerian banks and was joined in the ranking in second and third place by Guaranty Trust Bank and Zenith Bank respectively. Nigerian banks According to the ranking First Bank is ranked 382 in the world out of the best 500 brands from its position of 414 last year. The brand value of the bank also increased to $228 million from $201 million from the preceding year. Guaranty Trust Bank on its part was ranked 422 among the 500 global best brands from its previous ranking of 415, while Zenith Bank moved a notch higher as it was ranked 453 from its previous position of 454 last year. Apart from the three banks, no other Nigerian bank made the ranking. Brand Finance is the world’s leading brand valuation consultancy which advises branded organisations on how to maximise their value through the effective management of their brands and intangible assets. According to The Top 500 Banking Brands report, though there are numerous ways of calculating brand value, Brand Finance which compiled the ranking used royalty relief method that values the brand based on what would be paid to use the brand if it were owned by a third party. The method is recognised by courts and tax authorities. The valuations of the brand take into account brand-specific financial and revenue data, model the market to identify market demand and the position of individual banks in the context of all other market competitors, establish the royalty rate for each bank, calculate the discount rate specific to each bank (taking account of its size, geographical presence, reputation, gearing and brand rating) and discount future royalty stream to a net present value, that is, the brand value. According to the Africa Editor of the magazine, Mr. Paul Wallace, brand value of Nigerian banks increased by three per cent to $593 million. This made Nigeria to be among the Top 50 countries of the world by total brand value