281
Nigerian banks posted a strong growth in interest income, hitting ₦15.4 trillion in the past year, as tighter monetary policies by the Central Bank of Nigeria (CBN) boosted earnings. This was revealed in the 20th edition of the Banking Sector Report by Afrinvest, which was launched in Lagos during the firm’s 30th anniversary celebration.
According to the report, the hawkish stance of the Monetary Policy Committee under Governor Olayemi Cardoso resulted in a cumulative 875 basis points hike in the benchmark interest rate between February and November 2024, bringing it to 27.5 percent. The move was aimed at controlling inflation, stabilising the naira, and restoring investor confidence. While the policy reduced liquidity in the financial system, it significantly increased income for commercial banks.
The Afrinvest report noted that interest income for the banks it reviewed rose by 118.5 percent year-on-year, reaching ₦15.4 trillion. Gains from trading activities also improved by 8.6 percent to ₦2.3 trillion. Pre-tax profits across the banking sector jumped by 65.7 percent to ₦6.2 trillion, showing that the lenders were able to create strong value despite Nigeria’s challenging economic environment.
On recapitalisation, the report disclosed that lenders had intensified efforts to meet the new capital requirements set by regulators. As of the first half of 2025, banks were estimated to have raised about ₦2.5 trillion through rights issues, public offerings, and private placements. At least four banks — Access Holdings, Zenith Bank, Ecobank, and Lotus Bank — were confirmed to have met the new capital thresholds ahead of the June 2026 deadline. Some other lenders are considering mergers and acquisitions to meet the requirement.
Afrinvest also observed that the banking sector remained resilient, with financial institutions’ GDP growing by 15 percent in real terms in the first quarter of 2025, ranking among the top ten contributors to Nigeria’s economy.
Speaking at the unveiling of the report, Group Managing Director of Afrinvest, Ike Chioke, said the theme of this year’s publication was “ACT-BOLD: Beyond a Trillion-Dollar Economy.” He explained that ACT-BOLD represents seven key industries — Agriculture, Creatives, Tourism & Hospitality, Technology, Banking & Other Finance, Oil & Gas, Logistics, and Domestic Manufacturing.
Chioke argued that these sectors could serve as engines of growth that would enable Nigeria to cross the $1 trillion GDP mark and strengthen its global competitiveness. He compared Nigeria’s potential with the growth trajectories of countries like India and Indonesia, which achieved economic breakthroughs through diversification and human capital development.
The Afrinvest boss further stressed that government savings from the removal of fuel and foreign exchange subsidies should be channelled into infrastructure, power, education, and healthcare. According to him, these investments would reduce the cost of living, provide relief to the over 133 million Nigerians living below the poverty line, and build the foundation for inclusive growth.
“We cannot leave anybody behind, and it is important that we do not forget our brothers and sisters across the country who are suffering as a consequence of the economic reform that has been introduced by the government,” Chioke said. He added that if Nigeria invested properly in the seven highlighted sectors, the country could surpass the $1 trillion economic target.
Chairman of Afrinvest West Africa Limited, Donald Lawson, represented by development economist Professor Osita Ogbu, also spoke at the event. He noted that Afrinvest had built a legacy of resilience, helping to shape industries, support corporates, and strengthen Nigeria’s financial markets.
“Our legacy is not just in numbers, but in impact. Over the decades, we have pioneered transactions that reshaped industries, facilitated investments that built infrastructure, supported governments and corporates and contributed to the development of Nigeria’s financial markets,” he said.
Lawson also outlined Afrinvest’s plans for the next three decades. The company aims to expand retail reach from hundreds of thousands to millions of Nigerians, strengthen its leadership in investment banking, asset management, securities trading, and fintech, and broaden its influence beyond Nigeria into other African markets.
Afrinvest, founded in 1995, has grown from its early beginnings as Securities Transaction and Trust Company Limited, established by former Edo State Governor Godwin Obaseki, to a leading financial services group with a reputation for research, advisory, and capital market activities. Its merger with Afrinvest Nigeria Limited in 2006 under the leadership of Ike Chioke has helped shape its present structure and growth.
With the release of the 20th Banking Sector Report, Afrinvest has reinforced its role as a key voice in Nigeria’s financial landscape, providing insights into policy directions, sector performance, and strategies for national economic transformation.
