Nigerian Banks report N15.4tn Interest Income boost amid CBN’s tight monetary policy

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Nigerian banks recorded a surge in interest income to ₦15.4 trillion over the past year, driven by the hawkish stance of the Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN).

This was disclosed in the 20th edition of the Banking Sector Report (BSR) by Afrinvest, titled “ACT-BOLD: Beyond a Trillion-Dollar Economy”, unveiled in Lagos during the firm’s 30th anniversary celebration.

Between February and November 2024, the CBN raised the benchmark interest rate by a total of 875 basis points to 27.5 percent in a bid to control inflation, stabilize the naira, and rebuild investor confidence. While the policy tightened liquidity, it boosted banks’ earnings significantly. Analysts project a possible 100 basis point rate cut by year-end, though the MPC has since maintained a hold position.

The report’s executive summary stated: “Monetary policy under the Cardoso-led CBN pivoted aggressively in 2024 to tame inflation, restore market confidence, and stabilise the FX rate. A prominent policy measure deployed by the apex bank was the successive hikes in the benchmark rate by a cumulative 875 bps to 27.50 per cent between February 2024 and November 2024, and this, alongside other variables, was left unchanged throughout H1:2025.”

It added: “This policy measure (though aimed at taming the system liquidity) drove a 118.5 per cent year-on-year jump in our coverage universe interest income to ₦15.4tn, while gains from trading activities also increased by 8.6 per cent to ₦2.3tn.”

Furthermore, the report revealed that lenders’ pre-tax profits surged by 65.7 percent to ₦6.2 trillion, demonstrating resilience in a challenging macroeconomic environment.

On recapitalisation, Afrinvest noted that banks had collectively raised about ₦2.5 trillion by mid-2025 through rights issues, public offerings, and private placements. At least four banks—Access Corp, Zenith Bank, Ecobank, and Lotus—have already met the new capital requirements, while others are either on track or considering mergers and acquisitions ahead of the June 2026 deadline.

The report stated: “Overall, the growth of the banking sector (proxied by financial institution GDP) has remained resilient, clearing at 15.0 per cent in real terms in Q1:2025 and ranking among the top 10 contributors to the GDP in the period.”

Speaking at the launch, Afrinvest Group Managing Director, Ike Chioke, said the 20th BSR carried a special theme that was both visionary and practical. “ACT-BOLD is an acronym representing seven high-impact industries we have identified as accelerators of Nigeria’s future, comprising A – for Agriculture, C – for Creatives, Tourism & Hospitality, T – for Technology, B – for Banking & Other Finance, O – for Oil & Gas, L – for Logistics and D – for Domestic Manufacturing.

He explained, “Together, these sectors hold the potential to unlock prosperity well beyond the symbolic trillion-dollar GDP mark and position Nigeria as a truly competitive global economy. Just as countries like India and Indonesia have crossed that milestone by diversifying and investing in people, Nigeria too can chart its own path if we ACT BOLD.”

On Nigeria’s economic challenges, Chioke added: “But I think what can be done better would be for the government to channel the incremental savings from the subsidies that were removed into investing appropriately in infrastructure, fixing our roads and bridges, fixing telecommunications infrastructure, making sure the power gets to the people, and then also investing in the human capital sector, education and healthcare. That would also help bring the cost of living down for Nigerians and make sure that the 133 million Nigerians who live below the poverty level have some sort of cushion to withstand the shock that the economy is going through at this time.”

He stressed inclusivity: “We cannot leave anybody behind, and it is important that we do not forget our brothers and sisters across the country who are suffering as a consequence of the economic reform that has been introduced by the government. I think that if we can pull that together, then we are definitely on the trajectory for growth, as we outlined in the 2025 Banking Sector Report with the acronym ACT BOLD, because we believe that Nigeria can even surpass our $1tn economic policy target if we focus on these seven core sectors that we’ve profiled in that report.”

Chairman of Afrinvest West Africa Limited, Donald Lawson, represented by development economist Prof. Osita Ogbu, reflected on the firm’s legacy: “Our legacy is not just in numbers, but in impact. Over the decades, we have pioneered transactions that reshaped industries, facilitated investments that built infrastructure, supported governments and corporates and contributed to the development of Nigeria’s financial markets. This is a legacy we are proud of, a legacy written not in ink, but in the stories of businesses grown, economies strengthened, and lives touched.”

On Afrinvest’s future outlook, Lawson said: “Our ambition for the next 30 years is clear: to expand our retail reach from hundreds of thousands to millions, democratising finance in Nigeria. To deepen our leadership in investment banking, asset management, securities trading, and fintech, not only in Nigeria but across Africa. To continue producing research and thought leadership that guides policy, informs investors, and strengthens our markets.

“We will continue to uphold the values that have defined us for three decades: innovation, integrity, professionalism, service, and an unwavering commitment to our clients. These principles will remain our compass as we navigate the future

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