Lower loan-loss charges lift banks’ profits

LAGOS, Nigeria — Lower credit impairment charges were the biggest source of profit support for eight banking groups listed on the Nigerian Exchange in the nine months ended September 30, 2026, even as their combined net interest income declined.

An analysis of the eight groups’ nine-month financial statements shows that their combined profit before tax rose 14.2% to ₦5.29 trillion from ₦4.63 trillion in the same period of 2025. Net impairment charges fell 48.1% to ₦977 billion from ₦1.88 trillion, a reduction of about ₦906 billion. That was larger than the ₦659 billion increase in combined pre-tax profit.

The groups are Zenith Bank, Ecobank Transnational Incorporated, First HoldCo, Guaranty Trust Holding Company, Access Holdings, Stanbic IBTC Holdings, Wema Bank and Sterling Financial Holdings.

Zenith Bank and Access Holdings account for most of the relief. Zenith recorded the largest reduction in impairment charges, of about ₦552 billion, but its pre-tax profit rose only 1.2% to ₦928.80 billion, indicating that lower provisions offset weaker income from other activities. Access Holdings’ impairment charges fell ₦257.08 billion, or 73.5%, to ₦92.91 billion, and its pre-tax profit rose 8.3% to ₦667.36 billion. Together, the two banks account for about ₦809 billion of the ₦906 billion reduction.

Guaranty Trust Holding Company also benefited from about ₦39.6 billion in lower impairment charges, but its pre-tax profit fell 2.3% to ₦879.90 billion.

The sources of earnings growth varied across the groups. First HoldCo’s pre-tax profit rose 60.8% to ₦911.24 billion despite a 16% decline in net interest income, helped by trading and fair-value income that increased by about ₦190 billion. Stanbic IBTC Holdings’ trading revenue rose to ₦210.13 billion from ₦23.86 billion, and its pre-tax profit increased about 35% to ₦531.88 billion despite a 14.9% fall in net interest income. Wema Bank’s net interest income rose 38.3% to ₦325.88 billion, lifting its pre-tax profit 76.6% to ₦258.64 billion. Sterling Financial Holdings’ net interest income rose 43.9% to ₦205.90 billion, and its pre-tax profit rose 37.1% to ₦97.28 billion, although higher impairment charges and operating expenses absorbed part of the gain.

Net interest income across the eight groups fell 1.8% to ₦7.88 trillion from ₦8.02 trillion. Interest income rose only 0.7% to ₦12.83 trillion, while interest expense increased 5.1% to ₦4.95 trillion. Net fee and commission income rose 13.2% to ₦2.26 trillion, and non-interest income overall grew 6.2% to ₦3.77 trillion.

Operating expenses rose 6.4% to ₦5.39 trillion, faster than combined operating income, which grew 0.7% to ₦11.65 trillion. The analysis concludes that lower impairments preserved earnings while core operating income growth stayed modest.

Management teams generally pointed to lower credit costs, diversified income and operating efficiency. Zenith Bank’s Group Managing Director, Adaora Umeoji, said lower funding and credit costs had contributed to profitability and improved earnings quality. Access Holdings’ Group Chief Executive Officer, Innocent Ike, said the improvement in impairment charges demonstrated the resilience of the group’s core earnings base. Guaranty Trust Holding Company’s Group Chief Executive Officer, Segun Agbaje, said core earnings continued to grow despite fair-value losses.