Five listed Nigerian Tier-1 banks, also 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 a decline of about 18% from the N5.06 trillion recorded in 2024.
A review of results from Access Holdings, FirstHoldco, GTCO, UBA, and Zenith Bank shows that 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, beneath the weaker headline, profit lies in a different story.
The banks’ core operations remained strong, with combined interest income rising by 17.66% to N14.49 trillion, up from N12.31 trillion in 2024.
This highlights a narrowing gap between lending and securities income, suggesting that banks are no longer relying primarily on lending, but are increasingly allocating capital to government instruments
A closer look at individual banks shows a clear divergence in strategy. UBA and GTCO generated more income from investment in securities than from lending.
In contrast, Access Holdings, FirstHoldco, and Zenith Bank continued to earn more from loans. Access recorded N1.95 trillion in loan income against N1.35 trillion from securities, while Zenith posted N1.82 trillion from loans compared to N1.64 trillion from securities, highlighting how the gap is gradually narrowing.
This trend is further reflected in asset allocation, with banks increasingly channeling funds into investment securities relative to loans.
Combined loans and advances rose modestly by 7.63% to N43.01 trillion in 2025, compared to a much stronger 23.25% growth in investment securities, which increased to N48.88 trillion.
As a result, total investment in securities now exceeds loan books, reinforcing the growing importance of government instruments such as treasury bills and bonds in banks’ balance sheets.
A closer look at individual banks shows how this shift is playing out across the industry.
In contrast, FirstHoldco and Zenith Bank remain more lending-focused, although the gap is narrowing.
Despite this shift in asset allocation, credit risk across these banks continues to rise.
Impairment charges on loans and advances to customers increased significantly, with combined impairments rising by 58.73% to N2.29 trillion in 2025, compared to N1.44 trillion in 2024.
This increase may also be partly linked to the exit of regulatory forbearance directed by the Central Bank of Nigeria (CBN) last year.
Overall, the surge in impairment charges, alongside other pressures such as weaker FX income and rising operating costs, contributed significantly to the decline in Tier-1 banks’ profitability in 2025.
The pressure on earnings was further compounded by a sharp decline in net trading and foreign exchange income.
At the same time, operating expenses, including depreciation and amortization rose significantly across the board, increasing by 29.03% to N5.53 trillion in 2025 from N4.29 trillion in the prior year.
These combined contributed to the decline in profit in 2025 compared to 2024. The strong asset base and deposit growth highlight the underlying strength and stability of Tier-1 banks, positioning them to sustain growth as macroeconomic conditions evolve.
Total assets rose by 10.29% to N160.97 trillion in 2025, up from N145.95 trillion in the prior year, reflecting continued expansion in banking activities.
This growth was largely supported by strong customer deposits, which stood at a combined N114.27 trillion, underscoring sustained confidence in the banking system and providing a stable funding base for operations.
