New Telegraph

Parthian Partners: Banks’ll face increased competition from telcos

Prediction 

CBN granted approval in  principle for PSB licences  to MTN Nigeria, Airtel

 

With the Central Bank of Nigeria (CBN) granting approval in principle for Payment Service Bank (PSB) licences to top telecommunications companies, MTN Nigeria and Airtel Africa, in November, coupled with the rapid growth of the fintech industry, deposit money banks in the country should brace for tougher competition this year, leading inter-dealer brokerage firm, Parthian Partners Lim  ited, has said.

 

The Chief Strategist at Parthian Securities (a member of the Parthian Group), Mr. Ahmed Banu, stated this at recent webinar organised by the firm. According to him, “once the actual PSB licenses are granted to MTN Nigeria and Airtel Africa, it will change the dynamics of the banking industry.”

 

He noted that increased competition from financial technology companies was already pushing many banks into adopting a HoldCo structure that would enable them to have subsidiaries which would operate as digital banks.

 

He also said that there is speculation in financial circles that increased competition could lead to the banking industry recording mergers and acquisitions among some Tier-2 lenders this year.

 

Banu further stated that Parthian Securities believed that the Federal Government’s decision to suspend the removal of fuel subsidy was a positive development for the equities market as it would enable investors to have more disposable income to invest in the market.

 

Noting that interest rates have been on downtrend since 2019, he said that the firm expected the trend to continue this year.

“If interest rates are low, investors would want to invest in the market. However, if interest rates are high it will negatively impact the market,” he said.

 

At a media parley at the weekend, the Chief Executive Officer, Parthian Partners Limited, Mr. Oluseye Olusoga, said that the firm, which provides brokerage services for transactions among market dealers and between market dealers and investors, including Pension Fund Administrators, Fund Managers, DMBs and international financial institutions was marking its 10 years anniversary this year, having been founded in 2012.

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