# Why Tier-1 Banks Profits Fell 18% Despite Core Boom

## Summary
Nigeria's Tier-1 banks (FUGAZ: Access Holdings, FirstHoldco, GTCO, UBA, Zenith) reported combined pre-tax profit of N4.15tn for FY2025, down 18% from N5.06tn in 2024, due to 53% FX income drop, 59% impairment surge to N2.29tn, and 29% operating expense rise to N5.53tn. Core strength shines with 18% interest income growth to N14.49tn (loans N7.2tn, securities N6.21tn), shifting asset allocation toward securities (N48.88tn vs loans N43.01tn), total assets up 10% to N160.97tn on N114.27tn deposits.

## Content
Nigerian Tier-1 Banks Report 18% Decline in Combined Pre-Tax Profit for 2025

            
              
              
                Boardroom analysis of Tier-1 banks' 2025 results  (Credit: Mikhail Nilov via Pexels)
              
            
Five listed Nigerian Tier-1 banks—Access Holdings, FirstHoldco, GTCO, UBA, and Zenith Bank (collectively known as FUGAZ)—have released their full-year 2025 results for the period ended December 2025, reporting a combined pre-tax profit of N4.15 trillion. This represents an 18% decline from N5.06 trillion in 2024.
The decline was primarily driven by a sharp drop in net trading and foreign exchange gains, alongside a surge in impairment charges and operating expenses. However, the banks' core operations remained strong.
Strong Core Earnings

            
              
              
                Sources of rising interest income: loans and securities  (Credit: Monstera Production via Pexels)
              
            
Combined interest income rose 17.66% to N14.49 trillion from N12.31 trillion in 2024.

  Interest income from loans and advances to customers contributed N7.2 trillion, an 18% increase from N6.13 trillion, accounting for roughly 50% of total interest income.
  Income from investments in treasury bills, bonds, and other financial assets totaled N6.21 trillion, a 16.8% increase from N5.31 trillion, representing about 43% of total interest income.

This narrowing gap between lending and securities income indicates banks are increasingly allocating capital to government instruments rather than relying primarily on lending.
Individual bank strategies diverged: UBA and GTCO generated more income from securities than loans.

  UBA: N1.47 trillion from securities vs. N864.5 billion from loans.
  GTCO: N789.8 billion from securities vs. N559.4 billion from loans.

In contrast, Access Holdings, FirstHoldco, and Zenith Bank earned more from loans:

  Access Holdings: N1.95 trillion from loans vs. N1.35 trillion from securities.
  Zenith Bank: N1.82 trillion from loans vs. N1.64 trillion from securities.

Shift Toward Investment Securities

            
              
              
                Loans vs. securities: shifting balance sheet priorities  (Credit: Daniel Dan via Pexels)
              
            
Combined loans and advances grew 7.63% to N43.01 trillion, compared to 23.25% growth in investment securities to N48.88 trillion. Investment securities now exceed loans, underscoring their growing role on balance sheets.

  
    
      Bank
      Loans (N trillion)
      Securities (N trillion)
    
  
  
    Access Holdings13.3416.31
    UBA7.0214.43
    GTCO3.135.54
    FirstHoldco9.067.20
    Zenith Bank10.455.41
  

FirstHoldco and Zenith Bank remain more lending-focused, though the gap is narrowing. See related bank fee pressures.
Rising Impairment Charges
Impairment charges on loans and advances rose 58.73% to N2.29 trillion from N1.44 trillion, possibly linked to the Central Bank of Nigeria's (CBN) exit of regulatory forbearance in 2024. Learn more on CBN reforms.

  Access Holdings: +209.19% to N287.37 billion.
  FirstHoldco: +91.36% to N710.03 billion.
  UBA: +54.40%.
  Zenith Bank: +41.95%.
  GTCO: -51.40%.

Weaker FX Income and Higher Operating Expenses
Net trading and foreign exchange income fell 53% to N1.52 trillion from N3.22 trillion.

  Access Holdings: +40.33% to N1.23 trillion.
  FirstHoldco: -90.75% to N47.2 billion.
  Zenith Bank: -89.71%.
  GTCO: -51.96%.
  UBA: Net loss of N140.6 billion (vs. N181.8 billion gain in 2024).

Operating expenses rose 29.03% to N5.53 trillion from N4.29 trillion.

  UBA: +70.83%.
  FirstHoldco: +36.12%.
  Zenith Bank: +23.26%.
  GTCO: +17.95%.
  Access Holdings: +12.38%.

Balance Sheet Strength

            
              
              
                Total assets reach N160.97T amid deposit surge  (Credit: RDNE Stock project via Pexels)
              
            
Total assets grew 10.29% to N160.97 trillion from N145.95 trillion, supported by customer deposits of N114.27 trillion. This reflects underlying strength and stability, positioning the banks for sustained growth. Compare with sector revenue trends.
References:

  Central Bank of Nigeria (CBN)
  Nigerian Exchange Group (NGX) - Bank annual reports
  Access Holdings Plc Annual Report 2025
  Zenith Bank Plc Annual Report 2025
Sources:Original Source

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Source: Kodawire (EN)