Banks Rake in ₦14.26tn from Customer Loans as Interest Rates Soar

Nigeria’s top banks saw a windfall in 2024, earning a total of ₦14.26 trillion from interest on loans—nearly double the figure recorded the year before.

This sharp jump comes on the back of steep interest rate hikes by the Central Bank of Nigeria (CBN), which raised borrowing rates to as high as 35%.

The revenue boost is detailed in financial statements filed with the Nigerian Exchange and includes data from nine leading institutions: Access Holdings, Zenith Bank, First HoldCo (parent company of FirstBank), UBA, GTCO, Fidelity Bank, FCMB Group, Stanbic IBTC, and Wema Bank.

The CBN’s Monetary Policy Committee played a central role in this shift, consistently raising the Monetary Policy Rate (MPR), which climbed to 24.75%, pushing commercial lending rates even higher.

Loan Interest Earnings by Bank

• Access Holdings: ₦3.11tn (up 98.7%)
• Zenith Bank: ₦2.72tn (up 137.7%)
• First HoldCo: ₦2.39tn (up 155%)
• UBA: ₦2.37tn (up 120%)
• GTCO: ₦1.32tn (up 148%)
• Stanbic IBTC: ₦566bn (up 109%)
• FCMB Group: ₦621.8bn (up 75.2%)
• Fidelity Bank: ₦803.1bn (up 85%)
• Wema Bank: ₦354.6bn (up 91%)

In terms of growth percentage, First HoldCo posted the most significant surge. However, Zenith Bank had the largest naira gain, adding ₦1.58 trillion in interest income, followed closely by Access Holdings and First HoldCo.

Economic Fallout for Borrowers

While banks thrived, the impact on the wider economy has raised alarm. High borrowing costs, especially for manufacturers and small business owners, have made credit increasingly difficult to access. Reports show the manufacturing sector alone paid over ₦1.3 trillion in interest last year.

The CBN insists its policy is aimed at taming inflation, which ended 2024 at 34.8%. However, analysts warn the rate hikes are stifling economic activity and exacerbating financial hardship for low-income earners and SMEs.