Nine leading Nigerian banks generated approximately N14.72 trillion in interest income during the first three quarters of 2025, driven largely by elevated interest rates and higher yields in the financial markets. This represents a 27.68 per cent increase from N11.53 trillion recorded in the same period of 2024.
The analysis, based on unaudited third-quarter financial results filed with the Nigerian Exchange, covered Access Holdings Plc, First HoldCo, Zenith Bank Plc, United Bank for Africa (UBA), Guaranty Trust Holding Company (GTCO), Stanbic IBTC Holdings, Sterling Financial Holding Company, Wema Bank, and Ecobank Transnational Incorporated.
Access Holdings led the sector in absolute figures, with interest income rising 21.11 per cent to N2.90 trillion from N2.39 trillion in 2024. Zenith Bank followed closely, posting N2.74 trillion, up 40.77 per cent from N1.95 trillion a year earlier.
Ecobank reported a 20 per cent rise to N2.33 trillion, while First HoldCo recorded N2.29 trillion, representing a 40.38 per cent year-on-year growth. Together, these four banking groups accounted for the bulk of the sector’s interest income.
Zenith Bank and First HoldCo showed the strongest growth momentum among the major players, with Zenith’s interest income increasing by roughly N793.84 billion, and First HoldCo’s by N659.37 billion. GTCO reported a 25.56 per cent increase to N1.23 trillion, while UBA grew modestly by 10.08 per cent to N1.98 trillion.
Among mid-tier banks, Wema Bank recorded the fastest expansion, with interest income surging 72.65 per cent to N396.95 billion from N229.91 billion in 2024. Stanbic IBTC Holdings achieved 37.24 per cent growth, adding N158.53 billion, while Sterling HoldCo reported a 38.73 per cent increase to N262.42 billion.
According to the banks’ disclosures, the rise in income was driven primarily by loans and advances to customers, investment securities, and cash balances, all of which benefited from higher market interest rates.
The sustained rate hikes by the Central Bank of Nigeria (CBN) contributed significantly to the sector’s strong interest performance. However, at its September 2025 Monetary Policy Committee meeting, the CBN implemented its first rate cut in years, lowering the Monetary Policy Rate (MPR) by 50 basis points to 27.00 per cent.
The apex bank also adjusted the Cash Reserve Ratio (CRR) for commercial banks to 45 per cent, retained that of merchant banks at 16 per cent, introduced a 75 per cent CRR on non-TSA public sector deposits, and kept the liquidity ratio at 30 per cent.
According to CBN Governor Olayemi Cardoso, the decision to ease rates was based on evidence of disinflation in recent months.
Despite the policy shift, data from the CBN showed that the maximum lending rate rose to 29.84 per cent in September, up from 29.13 and 29.31 per cent in the preceding months. Meanwhile, credit to the private sector fell to N72.53 trillion in September from N75.88 trillion in August, reflecting a temporary decline in lending appetite following the rate adjustment.
While the sector’s earnings remain strong, analysts warn that sustained rate cuts could compress banks’ net interest margins in the coming quarters unless higher loan volumes offset declining yields.
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