Nigerian mid-tier lender FCMB PLC said on Tuesday it is targeting loan growth of 10% to 14% this year as the impact of the coronavirus pandemic prompts healthy companies to increase credit facilities in order to weather the crisis.That would be well down on 29% growth in gross loans last year but Group Chief Executive Ladi Balogun was upbeat.

“We expect loans to remain robust,” he said.

“What we are seeing is that there’s going to be more credit requirement as a result of COVID-19 for those companies that are healthy and can justify the need,” the CEO said on a call with analysts.

Balogun said the bank will lend to top-quality names within the consumer goods sector and small businesses. The bank also expects credit to agriculture, manufacturing and healthcare sectors to grow.

On Tuesday, Nigerian officials said they expect the economy to shrink by 3.4% this year as dwindling oil revenues and the impact of the coronavirus force the country to cut budget plans for a second time.

Nigeria, which has recorded 2,802 cases of the coronavirus and 93 deaths, began to ease a nationwide lockdown on Monday after four weeks.

Balogun said economic recovery will require a rise in oil prices but the bank’s loan growth will be driven by customers investing in anticipation of the recovery. He expected that interest rates will go up due to higher credit demand.

FCMB said it was restructuring half of its loan portfolio, in line with leeways allowed by the central bank and the accounting standards body during the pandemic. It expects the restructuring, targeted mostly at the oil and retail sectors, to be completed within the next two weeks.

($1 = 360.00 naira)