African banks surpass $100bn revenue, outpace global growth

African banks have crossed the $100 billion annual revenue mark for the first time, underscoring the sector’s growing strength and resilience across the continent.

According to a report by McKinsey & Company, banking revenues rose from about $99 billion in 2024 to an estimated $107 billion in 2025, reflecting a shift from long-held projections of potential to measurable performance and profitability.

An official of the firm noted that the latest figures signal a turning point in Africa’s financial landscape, as banks increasingly demonstrate sustained growth.

The report emphasised that the sector is no longer defined by future promise but by tangible outcomes driven by improved profitability and consistent expansion.

Speaking on the development, Mayowa Kuyoro, partner and head of the firm’s financial services practice in Africa, said the industry had reached an inflexion point.

“African banking has moved decisively from a story of potential to one of performance,” he said.

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Kuyoro added that the next phase of growth would depend on how effectively banks evolve beyond traditional models, particularly in digital transformation and innovation.

“The next phase of competition will be defined by how banks scale digital capabilities and build revenue streams beyond traditional lending,” he stated.

Despite the strong growth, the report noted that revenues remain concentrated in five key markets—Egypt, Kenya, Morocco, Nigeria, and South Africa—which collectively account for about 70 per cent of total banking revenues on the continent.

South Africa continues to dominate as the largest market, generating approximately $26.4 billion in customer-driven revenues in 2024.

Growth across the sector has been driven by high interest rates, loan repricing, and gains from foreign exchange and trading activities, even as banks contend with currency volatility and uneven macroeconomic conditions.

Lending remains the largest revenue segment and is projected to expand to about $52 billion by 2030, while small and medium-sized enterprises are expected to emerge as the fastest-growing customer segment.

In comparative terms, Africa’s banking sector has outperformed global peers. On a constant-currency basis, revenues grew by about 17 per cent annually between 2020 and 2024, significantly higher than the global average.

However, in dollar terms, growth was more moderate at around 5.2 per cent per year, reflecting the impact of exchange-rate fluctuations across several markets.

Nigeria mirrors continental momentum

Recent developments in Nigeria reflect the broader continental trend, particularly in capital inflows and sector expansion.

Foreign capital inflows into the banking sector rose sharply to $13.53 billion in 2025, representing a 93.25 per cent increase from $7.00 billion recorded in 2024.

The surge was driven largely by intensified capital raising efforts ahead of the recapitalisation deadline set by the Central Bank of Nigeria.

The apex bank also disclosed that lenders mobilised N4.61 trillion in fresh capital under the ongoing recapitalisation programme, signalling strong investor confidence and increased foreign participation.

In addition, Nigeria’s finance and insurance sector recorded a 14.54 per cent growth rate in 2025, up from 2.95 per cent in 2024, with financial institutions alone posting a 26.15 per cent growth rate—further reinforcing the sector’s expanding role in the economy.