Clashes in the run-up to Nigeria’s elections that killed several people and the CBN’s bailout of banks have made the nation’s stocks so cheap that Mark Mobius, Standard Bank Plc and Renaissance Capital say it’s time to buy.

Nigeria’s shares tumbled 11 percent from this year’s peak in January, reducing the MSCI Nigeria Index to its lowest valuation compared with the MSCI Frontier Markets Index since December 2009, data compiled by Bloomberg show. Bank shares trade 30 percent below the average for lenders in Europe, the Middle East and Africa relative to assets, according to data from Renaissance Capital.

President Goodluck Jonathan, a Christian from the south, faces candidates including Nuhu Ribadu, a northern Muslim, in elections a week after the parliamentary vote was beset by bombings of two polling stations and delays caused by the late arrival of ballot papers. Investors are looking beyond the current turmoil as crude above $100 a barrel spurs 8 percent economic growth this year for Africa’s biggest oil producer while bank profits surge.

“Of course there will be volatility as a result of the elections, but from a longer range point of view we are quite bullish,” Mobius, who manages about $34 billion of assets as the executive chairman of Templeton’s Emerging Markets Group, said in a phone interview from Singapore. “Banks are the biggest things we have in Nigeria,” including Zenith Bank Plc and United Bank for Africa Plc, he said.

Zenith Bank, Nigeria’s biggest lender by market value, said last month that 2010 profit jumped 81 percent, and Guaranty Trust Bank Plc, the third largest, reported a 62 per cent increase. First City Monument Bank Plc, which ranks eighth for market value, posted a 12_fold surge in 2010 earnings and a decrease in non_performing loans to 5.5 percent from 8.7 percent of outstanding debt. United Bank for Africa, ranking fifth, hasn’t yet reported 2010 earnings. All four are based in Lagos.

“There’s fantastic upside at the moment,” Bo MacEwan, the head of trading at African Alliance Securities Ltd., a stock broker with offices in 12 countries on the continent, said in a phone interview from Johannesburg. “We are engaging our clients to actually get stuck into the banks” he said, adding that Zenith and Lagos_based Diamond Bank Plc were the “best call.”

Central bank Governor Lamido Sanusi bailed out 10 of Nigeria’s 24 lbanks in 2009 and fired eight bank chiefs after loans to equity speculators contributed to 700 billion naira ($4.5 billion) of non_performing debt, according to the Economic and Financial Crimes Commission.

The government rescued lenders by buying bad debt totaling 2.04 trillion naira through its Asset Management Co. of Nigeria. Amcon, as the state_owned vehicle is known, sold 20.7 billion naira of bonds last week. Banks’ fortunes are improving even amid violent clashes linked to this month’s parliamentary and presidential votes. More than 50 people have died in election_related fighting since July, according to Amnesty International, while sectarian violence in the north caused at least 200 deaths since Dec. 24.