A mid-tier lender, First City Monument Bank, expects loan growth to be flat this year — down from last year’s 5.4 per cent rise — as oil companies pay down debt, according to its Group Chief Executive Officer, Ladi Balogun.

Balogun said the bank would focus on retail banking with a higher margin this year to make up for a drop in government bond yields as the lender might not be able to write large loans quickly enough to counter-balance repayments by oil firms.

He said the economy was improving after the country experienced its worst recession in a quarter of a century in 2016, which should boost consumers, Reuters reported.

“We expect to see large repayments in the oil and gas sector this year. We agree that the (economy) will be improving but largely because of chunky pay-down; we don’t think we would be able to replace quickly,” he told an analyst call, adding, “We are pushing more in the area of retail banking.”

Balogun said the group was seeking to convert its wholesale banking unit in Britain, FCMB UK, into a retail bank, as part of its push to grow its balance sheet and tap into non-institutional customers in Britain.

He stated that the impact of the British strategy would not be immediate but would enable the lender to achieve incremental growth.