Despite CBN’s Policy Shift, Five Banks Post N9.88tn Interest Income as High Rates Persist

Kayode Tokede

Despite a marginal easing of monetary policy by the Central Bank of Nigeria (CBN), five leading banks generated a combined N9.88 trillion in interest income in 2025, underscoring the sustained impact of a high-interest-rate environment on financial-sector earnings.

The figure, drawn from the audited full-year results of Zenith Bank Plc, Wema Bank Plc, Stanbic IBTC Holdings Plc, Ecobank Transnational Incorporated, and Guaranty Trust Holding Company Plc (GTCO), represents a 27.7 per cent increase from N7.74 trillion recorded in 2024.
The strong performance came even as the apex bank trimmed its Monetary Policy Rate (MPR) to 27 per cent in a bid to rein in inflation and stabilise the naira.

Analysis showed that the elevated interest rate regime continued to drive banks’ earnings from loans, advances, and investment securities, even as it raised borrowing costs for businesses and households.
A breakdown of the results indicated that Zenith Bank led the pack with N3.67 trillion in interest income, marking a 35 per cent increase from the previous year.

 Ecobank followed with N3.19 trillion, while GTCO posted N1.65 trillion, up 23 per cent from 2024. Stanbic IBTC recorded N787.05 billion, representing a 39 per cent rise, and Wema Bank reported N576.07 billion, a sharp 62.4 per cent increase year-on-year.
GTCO, in its presentation to investors, attributed the growth to expansion in earning assets and improved portfolio yields.
However, it noted a contraction in non-interest revenue, largely driven by declines in fair value and derivative gains.

Industry data further revealed that Nigeria’s average maximum lending rate moderated slightly to 29.32 per cent in December 2025 from 29.71 per cent a year earlier, after peaking at 30.50 per cent in February 2025 when the MPR stood at 27.50 per cent.
The prime lending rate, which applies to top-tier borrowers, also eased to 18.02 per cent from 18.56 per cent in 2024.
Market analysts linked the surge in interest income to the sustained tightening stance adopted by the CBN and other central banks across Africa since 2024, as authorities grapple with inflationary pressures and currency volatility.

An investment banker, Mr. Tajudeen Olayinka, explained that the high-rate environment reflected a deliberate policy to attract foreign portfolio inflows, boost external reserves, and support exchange rate stability.
According to him, the repricing of financial instruments across markets has continued to push up yields on loans and securities, reinforcing banks’ earnings momentum.

CBN Governor, Yemi Cardoso, had earlier acknowledged that inflationary pressures remain elevated, driven by factors such as rising electricity costs, foreign exchange demand, and lingering structural constraints.

He, however, expressed optimism that ongoing government reforms aimed at boosting local production would ease price pressure over time.

For now, analysts say the contradiction persists. While banks continue to benefit from high yields, the broader economy faces tightening credit conditions that could weigh on growth and job creation if rates remain elevated for too long.