Naira Devaluation Lifts Foreign Subsidiaries’ Earnings Contribution to Nigerian Banks — Fitch
The sharp depreciation of the naira between 2023 and 2024 has significantly increased the contribution of foreign subsidiaries to the earnings and asset base of major Nigerian banking groups, according to Fitch Ratings. The rating agency said the trend reflects the growing importance of international operations as Nigerian lenders expand across Africa and other global markets.
In its report titled “African Banking Groups’ Cross-Border Expansion to Continue,” published on September 14, 2026, Fitch reviewed 14 African banking groups operating in at least five African countries, with combined assets of more than $15 billion as of the end of 2025. Four Nigerian lenders — Access Bank, United Bank for Africa (UBA), Zenith Bank and First HoldCo — were among the institutions assessed.
UBA recorded one of the strongest increases, with its foreign subsidiaries contributing 77% of group net income in 2025, compared with 44% in 2024. The bank’s international operations also accounted for 52% of total assets at the end of 2025. Access Bank similarly saw its foreign subsidiaries contribute 48% of group net income in 2025, up from 30% in 2021, while their share of total assets increased to 51% from 23% over the same period.
Fitch also pointed to Access Bank’s aggressive cross-border expansion, particularly its acquisition of Mauritius-based AfrAsia Bank, completed in July 2025. The acquisition, involving a bank with a $6.9 billion balance sheet, represented about 19% of Access Bank’s consolidated assets at the time. However, Fitch noted that Access Bank recently breached a regulatory limit on investments in foreign subsidiaries, prompting measures aimed at restoring compliance. Zenith Bank’s acquisition of Kenya’s Paramount Bank in April 2026 was also highlighted as part of the broader expansion of Nigerian banks into East Africa.
The rating agency expects fresh capital raised by Nigerian banks to support further international growth, with some lenders likely to strengthen existing subsidiaries or pursue new opportunities across Africa. Fitch, however, said sovereign risk remains a key constraint because the credit ratings of African banking groups remain closely linked to their home countries. Despite this, the agency expects geographic diversification to gradually reduce Nigerian banks’ exposure to domestic economic and sovereign risks over the medium term.
source: nairametrics