The leverage and hedging strategies against lower prices used by Nigeria’s oil producers will determine their chances of survival




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TheAfricaReport writes: "The leverage and hedging strategies against lower prices used by Nigeria’s oil producers will determine their chances of survival – and the size of the hit to their lenders.''

“It is clear that some of the most over-leveraged local players in Nigeria will not survive the current price collapse,” said Yann Alix, a partner at @ashurst in London. “This will bring pain to their lenders,” in Nigeria and abroad, he says.
-Oil and gas coys accounted for c.30% of all banking-sector loans in 3Q 2019, and their borrowing accounts for 24% of all NPLs in Nigeria
-Lenders with heavy exposure to Nigerian oil producers include First Bank, GTB, Zenith and Access, says Michael Famoroti of @StearsBusiness