The recent mention of three Nigerian banks in the World Banking Brands Ranking, released by the Banker Magazine of the Financial Times of London group and Brand Finance has brought about an improvement in the status of Nigerian banks among its peers in the global financial community.
In the recent ranking released, three Nigerian banks appeared in the top 500 ranking, with a combined brand value of $574 million (N90.7 billion), out of the total global banking brand value of $860.7 billion.
Only Nigeria and South Africa are the African countries that made the Top 50 banks by total brand value among the countries of the world.
Nigeria’s banks inclusion in the ranking is a pointer to the improvement recorded in the Nigerian banking sector over the years and also a reflection of the resolution of the crisis in the Nigerian banking sector.
Brian Caplen, Editor, The Banker Magazine, said on a global scale, total banking brand value of $860.7 billion are the highest they have ever been and are nearly double the level in 2009 during the worst of the financial crisis.
He added that bankers are now more aware of the importance of brand to their business and how it needs to be both invested in and protected.
Also speaking, David Haigh Chief Executive Office, Brand Finance, noted that the 2013 results show that globally the banking crisis is nearly over as both brand ratings and values are rising.
Caplen said the process has five steps. These are getting the brand-specific financial and revenue data before segmenting the revenue into retail banking, commercial banking, wholesale/investment banking, insurance, asset management and credit cards streams; 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 which brings about the brand value.
First Bank leads the pack in Nigeria with a brand value of $201 million while the totality of the value of the three Nigerian banks that made the Top 500 World Banking Brands is $574 million and they collectively do the country proud as the country is among the World’s Top 50 by Total Brand Value.