Nine of Nigeria’s leading banks collectively earned about ₦14.72 trillion in interest income during the first nine months of 2025, representing a 27.68% year-on-year increase from the ₦11.53 trillion recorded in the same period of 2024.
An analysis of unaudited third-quarter financial statements submitted to the Nigerian Exchange Limited (NGX) shows that the growth was largely driven by the sustained high-interest rate environment and robust earnings from loans, advances, and investment securities.
The review covered the financial performance of Access Holdings Plc, First HoldCo (FirstBank), 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 (ETI).
According to the Corporate Finance Institute, interest income refers to revenue earned by financial institutions from lending funds or investing in interest-bearing instruments such as deposit accounts and treasury securities.
Access, Zenith, and First HoldCo Dominate Earnings
Access Holdings led the pack with an interest income of ₦2.90 trillion, marking a 21.11% increase from ₦2.39 trillion in Q3 2024.
Zenith Bank followed closely with ₦2.74 trillion, reflecting a 40.77% growth from ₦1.95 trillion the previous year.
Ecobank Transnational Incorporated posted a 20% rise to ₦2.33 trillion, while First HoldCo earned ₦2.29 trillion, up 40.38% from ₦1.63 trillion.
Together, these four institutions accounted for the majority of the banking sector’s total interest income in the period under review.
Other Top Performers
- GTCO recorded ₦1.23 trillion, a 25.56% increase year-on-year.
- UBA posted ₦1.98 trillion, the lowest percentage growth at 10.08%.
- Wema Bank reported the most significant growth rate, with interest income soaring 72.65% to ₦396.95 billion from ₦229.91 billion.
- Stanbic IBTC Holdings grew by 37.24%, adding about ₦158.53 billion.
- Sterling Financial Holding Company achieved ₦262.42 billion, up 38.73% from ₦189.16 billion, driven mainly by customer loans and debt instruments measured at Fair Value Through Other Comprehensive Income (FVOCI).
The impressive earnings came amid a prolonged period of tight monetary policy, with the Central Bank of Nigeria (CBN) maintaining high interest rates to curb inflation.
At its September 2025 Monetary Policy Committee (MPC) meeting, however, the CBN made its first rate cut in years, reducing the Monetary Policy Rate (MPR) by 50 basis points to 27.00%.
The apex bank also adjusted the Cash Reserve Ratio (CRR) for commercial banks to 45%, introduced a 75% CRR on non-TSA public deposits, and maintained the liquidity ratio at 30%.
CBN Governor Olayemi Cardoso said the decision was based on improving disinflation trends observed in August — the strongest in five months.
Despite the slight rate cut, money market indicators showed lending rates remained high. As of September, the maximum lending rate stood at 29.84%, compared to 29.13% and 29.31% in July and August, respectively.
Meanwhile, credit to the private sector fell to ₦72.53 trillion in September from ₦75.88 trillion in August and ₦76.13 trillion in July, suggesting a slowdown in lending appetite.
Global ratings agency Moody’s Investors Service has warned that Nigerian banks may face profitability pressures following the rate cut. The agency noted that a decline in yields on loans and government securities could outpace any reduction in deposit costs.
“We expect the lower policy rate to reduce yields faster than deposit costs, which could narrow banks’ net interest margins,” Moody’s said.
Interest income accounted for about 62% of Nigerian banks’ total operating income in 2024, according to Moody’s, which added that the recent CRR reduction would only provide partial relief.
As banks continue to post record earnings amid tight monetary conditions, analysts say the coming quarters will reveal how resilient their margins remain under a shifting interest-rate regime.
