Nigeria’s finance and insurance sector recorded 9.29 per cent real growth in the second quarter of 2026, a sharp slowdown from the 16.13 per cent recorded in the same period of 2025, according to the latest Gross Domestic Product report by the National Bureau of Statistics (NBS).
The latest figure represents a 6.84 percentage-point decline year-on-year, although the sector performed slightly better than the 8.55 per cent growth recorded in the first quarter of 2026. The slowdown comes despite major recapitalisation exercises carried out by banks and insurance companies to strengthen their financial positions and meet new regulatory capital requirements.
Financial institutions remained the dominant force in the sector, accounting for 87.22 per cent of real output, while insurance activities contributed 12.78 per cent. On a nominal basis, financial institutions grew by 10.92 per cent year-on-year, while the insurance subsector recorded a stronger 18.88 per cent growth, pushing overall nominal growth in the sector to 11.88 per cent.
The stronger performance by insurers comes as operators conclude the recapitalisation exercise introduced under the Nigerian Insurance Industry Reform Act (NIIRA) 2025. Industry data cited in the GDP report showed that 43 insurance operators had raised at least N720bn to meet the new capital requirements. Banks also completed their recapitalisation programme, raising a combined N4.61tn ahead of the March 31, 2026 deadline.
With both industries now operating with stronger capital bases, attention is shifting to what comes next. Analysts say the real test will be whether the fresh capital can translate into more lending, increased investment and deeper insurance penetration, particularly if monetary conditions become more favourable. Despite the slowdown, the NBS still identified financial and insurance activities as key contributors to Nigeria’s non-oil economic growth during the quarter.
source: punch
