Nigerian Banks Achieve Record Profits Amid Economic Challenges.
Nigeria’s leading banks have posted unprecedented profits, with GTCo Plc and Zenith Bank Plc surpassing the N1 trillion post-tax profit mark for the first time. Despite economic difficulties in the real sector, particularly in manufacturing and agriculture, the banking industry has demonstrated remarkable resilience, reaching new financial heights.
Access Holdings Plc, the largest Nigerian bank by asset size, is also on track to join the trillion-naira profit league, requiring a 62 per cent growth in its 2023 post-tax profit of N619.3 billion. Meanwhile, UBA, GTCo, and Zenith Bank collectively reported an impressive N2.78 trillion in post-tax profits, marking a 53 per cent increase from N1.82 trillion in 2023.
The substantial profits of these banks contrast with the struggles of many businesses in Nigeria’s real sector. While manufacturers and small businesses grapple with high costs and limited access to affordable loans, banks continue to benefit from high-interest rates, commissions, and fees. The sector’s reliance on non-interest income has grown significantly, with fees and commissions surging by 178 per cent to N920 billion in 2024.
Bank executives and shareholders have also seen significant financial rewards. Jim Ovia, founder of Zenith Bank, will receive N25.4 billion in dividends, while Tony Elumelu of UBA and Segun Agbaje of GTCo will earn N12.7 billion and N3.33 billion, respectively. In total, the three banking giants will distribute N41.4 billion to their top stakeholders.
Despite the banking sector’s success, concerns persist regarding its impact on Nigeria’s broader economy. While the financial sector recorded a remarkable 28 per cent growth in 2024, its contribution to GDP remained at six per cent. Meanwhile, agriculture and manufacturing, which account for a combined 26 per cent of GDP, only grew by 1.8 per cent each.
Analysts suggest that the dominance of banks in profit-making without proportional contributions to economic development highlights structural imbalances in Nigeria’s financial system. As banks continue to expand their capital base, there are growing calls for financial institutions to play a more active role in supporting real sector growth rather than focusing primarily on short-term gains.
