Nigerian Banks Earn N18.2tn in 2025 Despite Profit Decline Amid Loan Losses and Recapitalisation Impact

Nigeria’s biggest banks posted a mixed financial performance in 2025, as strong revenue growth and expanding balance sheets were weighed down by a sharp decline in profitability linked to regulatory adjustments and rising loan loss provisions. Despite the pressure, the sector recorded a combined gross earnings of N18.2tn, marking a 7.69 per cent increase from N16.9tn in 2024.

The growth in earnings was largely driven by major tier-one lenders including Access Holdings, Zenith Bank, First HoldCo, United Bank for Africa (UBA), and GTCO. Access Holdings led the pack with N5.52tn, followed by Zenith Bank with N4.07tn, First HoldCo at N3.21tn, UBA at N2.97tn, and GTCO at N2.11tn. The figures reflect sustained strength in core banking operations despite economic headwinds.

A key driver of performance was the surge in interest income, supported by Nigeria’s high-interest-rate environment. Zenith Bank nearly doubled its interest income to N2.72tn, while GTCO rose to N1.32tn. At the same time, digital banking continued to gain traction, with e-banking revenue climbing to N685.5bn, highlighting the growing role of technology in banking income streams.

However, profitability came under significant pressure as banks absorbed higher impairment charges following the end of regulatory forbearance. First HoldCo’s profit after tax dropped sharply to N52bn from N663bn, while UBA fell to N404bn from N766bn. GTCO also declined to N865bn from N1.01tn. Zenith Bank remained stable at N1.04tn, while Access Bank posted growth to N743bn. The decline reflects cleanup of legacy loan risks rather than fresh credit deterioration.

Despite the profit squeeze, the sector’s financial position strengthened significantly due to a recapitalisation programme that raised N4.65tn over two years, with 33 banks meeting Central Bank of Nigeria requirements. The Central Bank of Nigeria, led by Governor Olayemi Cardoso, said the reforms have improved resilience and stability in the banking system. Meanwhile, investors remain optimistic, with banking stocks driving a 0.36 per cent rally on the Nigerian Exchange, supported by strong buying interest in stocks like GTCO and Stanbic IBTC.

source: punch