UBS’ footprint in Africa has been scant at best. Now the bank has decided to withdraw from one of the continent’s strongest economies.
Swiss banking isn’t heavily rooted in Africa, which may have something to do with the country’s lack of a colonial past. A lot of African nations also are plagued by political instability or worse, making banking a treacherous enterprise.
It is no surprise then that those Swiss banks that have ventured south have not gone beyond South Africa. UBS also has had a representative office in Nigeria.
Precarious Peace
Not anymore though, according to a report by «Bloomberg». The report is based on a statement by the central bank of Nigeria, which didn’t give a reason for the bank’s decision and mentioned no date of closure. UBS didn’t comment the «Bloomberg» report.
UBS hasn’t been the only foreign bank to shut down operations in Nigeria recently. HSBC also closed down operations and the country now has only eight foreign lenders left.
Lots of Potential
Nigeria still is one of the most promising economies in Africa, with the continent’s biggest exploration of oil fueling its industries. But the country also struggles to contain regional dissent in the oil-rich delta and at the same time has been fighting Boko Haram, a brutal terrorist group for years. Investors have also complained about corruption and high inflation rates.
Foreign direct investment is declining rapidly. UBS has been critical about Nigeria’s economic outlook after the central bank ordered South African telecommunications concern MTN to pay back $8 billion in revenue generated locally.
Presidential Elections
In September, the government had suggested that HSBC had been involved in money laundering. The bank had been critical about a second term for the incumbent president, Muhammadu Buhari.
