- Nigerians obtain N2trn loans amid tight credit market – Report
Nigeria’s top five commercial banks — Access Corporation, Zenith Bank, First HoldCo, United Bank for Africa, and Fidelity Bank, collectively recorded a whopping N5.92 trillion in interest income from customer loans in 2024, as they capitalised on strong loan growth, higher interest rates, and effective repricing strategies.
The surge in interest income comes on the back of aggressive credit expansion, favourable market conditions, and rising demand for financing across sectors in the Nigerian economy.
According to data from the banks’ audited financial statements for the 2024 fiscal year, the combined interest income represents a significant leap from 2023, signaling a robust year for Nigeria’s banking industry.
Access Corporation, the parent company of Access Bank, emerged as the top performer among its peers.
The financial giant raked in a staggering N1.63 trillion in interest income from customer loans in 2024, representing a 118 percent increase from the N747.2 billion recorded in 2023.
The performance was driven by a 43 percent growth in its customer loan book, which climbed to N11.49 trillion by year-end. The bank’s average loan portfolio stood at N9.76 trillion, with loan yields averaging 17 percent.
This solidified Access Bank’s position as Nigeria’s largest lender by loan volume, reinforcing its dominance in corporate and retail lending.
Zenith Bank followed closely with N1.52 trillion in interest income — a 126 percent increase from the N671.9 billion posted in the previous year.
The bank’s loan book expanded by 52 percent to N9.97 trillion, making it one of the largest in the industry, second only to Access Bank.
The average loan portfolio during the year was N8.26 trillion, and the bank achieved an impressive yield of 18 percent.
Zenith Bank’s ability to maintain high lending margins while expanding its portfolio underscores its efficient risk management and strong customer base.
First HoldCo, the holding company of First Bank of Nigeria, posted interest income of N1.36 trillion, a remarkable 124 percent increase from N609.8 billion in 2023.
The group’s customer loan portfolio grew by 38 percent to N8.77 trillion, supported by an average loan portfolio of N7.56 trillion and a yield of 18 percent.
The result marks a strong comeback for the century-old institution, which has recently undergone strategic repositioning, digitisation efforts, and strengthened corporate governance under its new leadership.
The stellar performance confirms First Bank’s return to the upper echelon of the banking sector.
United Bank for Africa recorded N779.7 billion in interest income in 2024 — almost double the N391.9 billion recorded in the previous year.
This 99 percent year-on-year increase was driven by a 33 percent growth in its loan book to N6.95 trillion, with an average loan portfolio of N6.09 trillion and a yield of 13 percent.
Despite a slightly lower yield compared to its peers, UBA’s broad African footprint and diversified loan base allowed it to grow consistently across multiple markets, reaffirming its reputation as a pan-African financial powerhouse.
Fidelity Bank posted N626.3 billion in interest income, representing a 72 percent rise from the N363.4 billion recorded in 2023.
The bank’s loan portfolio grew by 42 percent to N4.39 trillion, supported by an average loan book of N3.74 trillion and a yield of 17 percent.
The growth trajectory underscores Fidelity Bank’s push to increase its market share in retail and SME lending, as well as its growing influence as a Tier-2 bank transforming into a stronger mid-tier competitor.
The record earnings from interest income highlight a major trend in the Nigerian banking sector — a shift toward more aggressive credit expansion, improved loan pricing, and strategic use of monetary conditions.
In 2024, banks were able to benefit from loan repricing amidst higher interest rate environments and significant FX revaluation gains, especially following the Central Bank of Nigeria’s policy reforms.
While this expansion in interest income has strengthened profitability and shareholder value, it also raises the question of sustainability, particularly in the face of rising inflation, currency volatility, and potential loan defaults.
Analysts warn that while the figures are impressive, banks must remain cautious and maintain robust risk management frameworks to guard against future shocks.