…No cause for alarm –Experts
By Uche Usim
Nigeria’s biggest banks closed 2025 with a blend of strong top-line expansion and a sharp, policy-driven squeeze on profitability. It signaled resilience in core operations but adjustment pains from regulatory reforms.
Nonetheless, experts have said that the development does not give reasons for concern.
According to audited results for the year ended December 31, tier-one lenders recorded a 7.69 per cent rise in combined gross earnings to N18.2 trillion, up from N16.9 trillion in 2024, driven by broad-based revenue growth across the sector.
Access Holdings led with N5.52 trillion, followed by Zenith Bank at N4.07 trillion, First HoldCo at N3.21 trillion, UBA at N2.97 trillion, and GTCO at N2.11 trillion, underscoring sustained strength in core banking activities despite macroeconomic pressures.
Interest income surged across key lenders, with Zenith Bank nearly doubling to N2.72 trillion and GTCO rising to N1.32 trillion, reflecting gains from Nigeria’s elevated interest rate environment. Non-interest income also strengthened, as e-banking revenue climbed to N685.5 billion, highlighting the growing role of digital channels in earnings.
Balance sheets expanded significantly, with Access Holdings’ total assets rising to N51.5 trillion, while UBA and Zenith Bank crossed N3.7 trillion and N31.4 trillion respectively. Shareholders’ funds also improved across the board, buoyed by a recapitalisation drive that strengthened capital buffers.
CBN Governor, Olayemi Cardoso, said the exercise has reinforced financial stability.
“The recapitalisation programme has strengthened the capital base of Nigerian banks, reinforcing the resilience of the financial system and ensuring it is well-positioned to support economic growth and withstand domestic and external shocks.”
The Central Bank of Nigeria confirmed that banks remained fully operational throughout the process, even as it phases out earlier regulatory forbearance measures.
However, the cost of that transition is now evident in earnings. First HoldCo’s profit after tax dropped to N52 billion from N663 billion, UBA fell to N404 billion from N766 billion, and GTCO declined to N865 billion from N1.01 trillion. Zenith Bank remained stable at N1.04 trillion, while Access Bank grew profit to N743 billion.
The divergence reflects higher loan loss provisions as banks clean up balance sheets and fully recognise legacy risks previously covered under regulatory reliefs.
This shift also explains expected dividend caution, with lenders prioritising capital preservation. UBA recorded N331 billion in loan loss provisions, First HoldCo’s impairments rose to N710 billion, while Access Holdings’ impairment charge jumped 209 per cent to N287.3 billion.
Despite the earnings pressure, investor sentiment remained upbeat, with banking stocks helping drive a 0.36 per cent gain in the NGX on May 4. The All-Share Index rose to 243,158.97 points, supported by strong buying in counters such as GTCO and Stanbic IBTC.
Market breadth improved to 1.69x, with 54 stocks closing in the green, signalling sustained confidence in the sector’s long-term fundamentals even amid short-term earnings recalibration.
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