Nigerian Banks Record N14.72tn Interest Income Amid Rising Rates

Nine leading Nigerian banks generated a combined N14.72 trillion in interest income during the first three quarters of 2025, benefiting from a high-interest-rate environment. Analysis of interim financial statements filed with the Nigerian Exchange Limited for the period ending 30 September 2025 shows that this represents a 27.68% increase from N11.53 trillion in the same period last year.

The unaudited third-quarter results reviewed include Access Holdings Plc (parent company of Access Bank), First HoldCo, Zenith Bank Plc, United Bank for Africa, Guaranty Trust Holding Company, Stanbic IBTC Holdings, Sterling Financial Holding Company, Wema Bank, and Ecobank Transnational Incorporated. Interest income, which refers to earnings from lending or investing funds, was the main driver of growth for these institutions.

Access Holdings led in absolute figures, posting a 21.11% rise to N2.90 trillion from N2.39 trillion in Q3 2024. Zenith Bank followed with N2.74 trillion, a 40.77% increase from N1.95 trillion. Ecobank reported a 20% rise to N2.33 trillion, while First HoldCo earned N2.29 trillion, up from N1.63 trillion. These four banks accounted for the bulk of the sector’s interest income during the period.

Among the top performers, Zenith Bank and First HoldCo showed the strongest year-on-year growth, with absolute increases of N793.84 billion and N659.37 billion, respectively. GTCO’s interest income rose 25.56% to N1.23 trillion, while UBA recorded the lowest growth at 10.08% to N1.98 trillion. Wema Bank stood out with a 72.65% increase to N396.95 billion. Stanbic IBTC and Sterling also posted robust growth rates of 37.24% and 38.73%, respectively, driven largely by loans, advances, and investment securities.

The surge in interest income was fueled by sustained hikes in the Central Bank of Nigeria’s Monetary Policy Rate (MPR), which supported higher lending yields. However, the CBN cut the MPR by 50 basis points to 27% in September 2025—the first rate reduction in years—while adjusting the Cash Reserve Ratio and standing facilities. The rate cut aims to support disinflation, but Moody’s Investors Service warned that lower rates may pressure banks’ net interest margins unless lending volumes rise sufficiently. Net interest income accounted for 62% of Nigerian banks’ operating income in 2024, underscoring the importance of interest rates to sector profitability.