The service analyst, Peter Mushangwe disclosed this yesterday in an emailed response to questions, Bloomberg said.
Mushangwe said: "A four percent devaluation of the naira versus the dollar will put negative pressure on Nigerian banks' asset quality and capital metrics as they have a high proportion of foreign-currency denominated loans.
"Foreign-currency borrowers who do not earn foreign currency will require higher naira cash flows to meet their obligations, diminishing their repayment capacity.
"A weaker naira also increases Nigerian banks' risk weighted assets related to their foreign currency loans, putting negative pressure on their capital metrics. However, the banks hold good capital buffers,"
Recently, the naira experienced the biggest daily depreciation of N15 in the parallel market since 2017. According to naijabdcs.com, the exchange rate platform of the
This trend also persisted in the Investors and Exporters (I&E) window during the period as the indicative exchange rate jumped to N374 per dollar at the close of business from N368.33 per dollar on 11th of
Last week, as a result of the adverse effect of Corona Virus Disease (COVID'19), the
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