There are 21 Egyptian banks in our ranking of Africa’s Top 100 Banks in 2021, compared to 12 for Nigeria, 10 in Kenya, eight each for Algeria, Morocco and Tunisia and six in South Africa.
The Top 100 Banks survey ranks the banks according to their Tier 1 capital. This consists of: capital + reserves + retained earnings + minority interests. These are published in local currencies and then converted into US dollars at the exchange rates at the year-end date in the results (or on 31 December 2020), so changing FX rates can affect the ranking.
We collect the data from Bankers’ Almanac, Moody’s Analytics BankFocus and the in-house research of African Business, excluding some banks where data is old or unreliable. The table below lists the Top 20 banks in the North African region along with their positions in the continental ranking.
Interest rate cuts hit profits
Credit agency Fitch estimated that real GDP growth in Egypt slowed to 3% in the year to end June 2021, from 5.6% a year earlier, but forecast a rebound to 6% in the year to June 2022. It says growth remains supported by less stringent lockdown measures and higher public investment and infrastructure spending.
The Central Bank of Egypt cut interest rates by 4% in 2020 to support lending, and banks’ operating profits are down due to lower interest income and higher provision for non-performing loans. In July 2021, Fitch revised its outlook on the Egyptian banking sector’s operating environment to “stable” from “negative”.
Morocco’s central bank, Bank Al-Maghrib, also cut the key interest rate by 0.75% to 1.5%, released the mandatory reserve requirement and eased the refinancing of loans to micro, small and medium-sized businesses. The bank forecast 5.3% growth in 2021, driven by a 17.6% rebound in the agricultural sector.
Leading Moroccan banks rival South African banks in their outreach across Africa. Hiba Zahoui, head of the banking supervision department at Bank Al-Maghrib, said: “The three largest Moroccan banking groups are present in 24 countries in sub-Saharan Africa,” and added that the bank expects most of these economies to rebound in 2021.
North African banks account for 45% of the Top 100 African banks
North African banks account for 45 of the entries in our 2021 survey of Africa’s Top 100 Banks and 11 of the spots in the continental Top 20.
National Bank of Egypt, which grew capital by 26% to $6.7bn, tops the regional table and rises to #2 (from #4) on the Africa ranking. Morocco’s Attijariwafa, which used to lead the region, is listed with tier 1 capital of $5bn and ranks #4 in the continent.
Next in the region are Morocco’s Banque Centrale Populaire at #7 on the Africa ranking (tier 1 capital up 11% to $4.7bn), Egypt’s Banque Misr at #8 (capital up 31% to $3.4bn although the results are to June 2019 and may be rendered outdated by Covid-19) and then Banque Nationale d’Algérie (#9) and Banque Extérieure d’Algérie (#10). The Algerian banks are rated on performance in the 12 months to December 2019 and BNA has capital up 20% to $3.4bn.
Egypt’s Commercial International Bank (CIB) climbs a slot to #11 with capital up 27% to $3.2bn, swapping places with Morocco’s BMCE Group, which nonetheless boosted capital by 17% to $3.1bn.
Other high-flying regional banks are Egypt’s QNB Al Ahli (#15, up from #17), Crédit Populaire d’Algérie (#18, down from #15), and Egypt’s Arab African International Bank (#19).
Top new entrants are Egypt’s Emirates National Bank of Dubai at #61 with capital of $419m, and Egyptian Gulf Bank at #78 with $307m in tier 1 capital.