Access Holdings Plc, Zenith Bank Plc, United Bank for Africa (UBA) Plc, Guaranty Trust Holding Company Plc, Ecobank Transnational Incorporated, and five other leading Deposit Money Banks (DMBs) generated a combined N4.6 trillion in interest income in the first quarter of 2026, underscoring the resilience of banks’ earnings amid persistent macroeconomic pressures.
An analysis of the unaudited first-quarter results of the lenders showed that the N4.6 trillion in interest income represented an 8.2 per cent increase over the N4.3 trillion recorded in the corresponding period of 2025.
The banks earned the income largely from loans and advances to customers, investments in government securities, balances with banks, and other interest-yielding assets, despite the Central Bank of Nigeria’s (CBN) moderation of benchmark interest rates.
The banks reviewed included Access Holdings Plc, Zenith Bank Plc, United Bank for Africa Plc, Guaranty Trust Holding Company Plc, Ecobank Transnational Incorporated, First Holdco Plc, Wema Bank Plc, Sterling Financial Holdings Company Plc, and Stanbic IBTC Holdings Plc.
The strong performance came despite the CBN’s decision to lower the Monetary Policy Rate (MPR) from 27 per cent to 26.50 percent between January and March 2026, amid relative stability in the foreign exchange market and easing inflationary pressures.
Among the lenders, Access Holdings, Zenith Bank, and First Holdco emerged as the top earners in interest income during the period under review.
Access Holdings posted N824.75 billion in interest income, although lower than the figure recorded in the corresponding period of 2025.
Zenith Bank followed closely with N869.1 billion, representing a 3.8 per cent increase from N837.64 billion recorded a year earlier.
First Holdco reported N704.45 billion in interest income, reflecting a growth of 12.7 per cent from N625.28 billion in the corresponding period of 2025.
Similarly, UBA recorded N641.1 billion in interest income, representing a 6.8 per cent year-on-year increase, while Ecobank posted N561.08 billion, up 23.4 per cent from N454.63 billion in the first quarter of 2025.
GTCO also maintained strong earnings momentum, posting N466.5 billion in interest income, representing nearly 18 per cent growth compared with the corresponding period last year.
The banks’ earnings performance came against the backdrop of persistently elevated lending rates in the Nigerian economy.
Data released by the CBN showed that the average maximum lending rate remained unchanged at 35.17 per cent in March 2026, despite the reduction in the policy rate.
The figure represents one of the highest lending rate levels on record.
Similarly, the average prime lending rate remained flat at 19.29 per cent for the second consecutive month in March 2026, after hitting 19.54 per cent in January, its highest level in nearly two decades.
While the prime lending rate reflects rates offered to the most creditworthy customers, the maximum lending rate represents the highest rate banks can charge borrowers.
Explaining the Monetary Policy Committee’s decision to maintain key monetary parameters at its 305th meeting, CBN Governor, Olayemi Cardoso, said members of the committee voted unanimously to allow previous tightening measures to continue working through the economy.
According to him, the committee acknowledged the recent marginal increase in inflation but considered it largely driven by temporary external shocks.
“The committee’s decisions were anchored on a comprehensive assessment of risks to the outlook,” Cardoso said, expressing confidence that the current policy environment remained capable of supporting disinflation over time.
Analysts, however, attributed the sustained growth in banks’ interest income to prevailing macroeconomic conditions and the high-interest-rate environment.
Global rating agency, Fitch Ratings, noted that the CBN’s tight monetary stance remained necessary to contain inflationary pressures and stabilise the economy.
The agency warned that despite the tightening measures, rapid credit expansion and money supply growth still suggested a relatively loose monetary environment, adding that real interest rates remained negative, thereby limiting foreign portfolio inflows.
Speaking with THISDAY, investment banker and stockbroker, Tajudeen Olayinka, said the prevailing high-interest rate regime was largely designed to attract foreign portfolio investment, strengthen foreign reserves, and stabilise the naira.
According to him, the continued repricing of securities across financial markets, including banks’ loans and advances, explains the strong interest income reported by lenders.
He, however, cautioned that the policy may become difficult to sustain over the long term due to rising debt-servicing costs and their inflationary implications for the economy.
“The huge debt service burden on the government and the pressure it exerts on inflation may ultimately raise sustainability concerns,” he said.
Kayode Tokede
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