Five listed Nigerian Tier-1 banks, also known as FUGAZ have released their full-year audited 2025 results for the period ended December 2025, reporting a combined impairment charges on loans to customers of N2.365 trillion compared to N1.44 trillion booked in 2024, according to Nairametrics.

This represents a 64 per cent YoY growth and marks the highest provision on loans and advances to customers in the last three years.

In 2023, the five banks made provision of N916.54 billion.

The banks are FirstHoldco, United Bank of Africa, Guaranty Trust Holdings, Access Holding and Zenith Bank.

By the end of 2025, the combined loans and advances to customers reported by the five banks stood at N43 trillion, representing an increase of about 8 per cent compared to N39.96 trillion recorded in 2024.

From these loans, the banks recorded combined interest income from loans and advances to customers of N7.1 trillion; out of the total interest income of N14.5 trillion.

That said, let us look at how the banks individually performed.

Guaranty Trust Holding Company Plc
Among the FUGAZ banks, GTCO stood out as the only lender to record a decline in impairment charges in 2025.

Net impairment charges on loans and advances to customers fell by 51.40 per cent to N66.4 billion in 2025 from N136.7 billion in 2024, despite growth in the customer loan book from N2.79 trillion to N3.13 trillion.

The decline appears to be largely driven by lower Stage 3 impairments, which dropped to N49.4 billion in 2025 from N64.6 billion in 2024.

This supported the bank’s capital position, with its capital adequacy ratio rising to 43.82 per cent from 39.31 per cent in 2024.

At the same time, the bank continued to grow its lending income.

Total interest income rose to N1.65 trillion in 2025 from N1.3 trillion in 2024, while interest income from customer loans increased to N559 billion from N509 billion; the least among the banks.
GTCO has maintained the muted impairment charges, just like in 2025, impairment charges on loans declined by 41 per cent to N7.949 billion from N13.484 billion in Q1 2025

Access Holdings Plc
Access Holdings Plc recorded the second-lowest impairment charges of N287 billion in 2025 from N93 billion in 2024.

This came as the bank’s customer loan book expanded to N13.34 trillion in 2025 from N11.49 trillion recorded a year earlier, maintaining one of the largest lending portfolios among the Tier-1 lenders.

From these loans, the bank earned interest income of N1.9 trillion in 2025, compared to N1.77 trillion in 2024, out of total interest income of N3.55 trillion, placing it just behind Zenith Bank Plc in overall interest income generation.

The bank’s capital adequacy ratio also improved to 18.12 per cent in 2025 from 18.03 per cent in 2024, reflecting a stronger capital buffer

A review of the impairment table suggests that most of the provisioning pressure came from Stage 3 credit-impaired loans, which stood at N133.5 billion by the end of 2025.

The bank also wrote off N309.5 billion during the year.

Coming into 2026, although impairment on customers’ loans increased by 116 per cent to N23 billion, it is still 8 per cent of 2025 full year impairment charge

United Bank for Africa Plc
United Bank for Africa Plc recorded impairment charges on loans and advances to customers of N381 billion in 2025, up 54 per cent from N246.9 billion recorded in 2024.

This came despite only modest growth in the bank’s customer loan book, which rose by 0.98 per cent to N7.02 trillion in 2025 from N6.95 trillion in 2024.
The increase in impairments appears to have been largely driven by a sharp rise in Stage 3 credit-impaired loans, which increased to N350.7 billion in 2025 from N196.7 billion in 2024.

Stage 2 impairments also rose to N81.7 billion from N26.4 billion in 2024
Overall, the group’s capital adequacy ratio dropped to 23.20 per cent from 31 per cent in 2024.

The bank earned N864.5 billion from the loans and advances to customers in 2025 compared to N779.7 billion in 2024. This represents about 33 per cent of the bank’s total interest income of N2.649 trillion, compared to the N2.370 trillion in 2024.

Coming into 2026, impairment charges on customer loans rose further to N38.2 billion in Q1 2026 from N11.1 billion in Q1 2025.

First HoldCo Plc
First HoldCo Plc recorded the 2nd highest impairment charges with net impairment on loans and advances to customers rising to N786.8 billion in 2025 from N371 billion in 2024.

This came from a customer loan book valued at N8.97 trillion, the third largest among the five banks, compared to N8.77 trillion recorded in 2024, representing an increase of N198.4 billion or 2.26 per cent year-on-year.
The sharp rise in impairments appears to have been largely driven by Stage 3 credit-impaired loans. From the bank’s total loan book, Stage 3 impairments stood at N218.8 billion, accounting for the largest share of total provisions, particularly within corporate term loans where impairments reached N173.7 billion.

First HoldCo’s capital adequacy ratio declined to 10.95 per cent in 2025 from 17.32 per cent in 2024.

At the same time, the bank continued to generate strong lending income. Interest income from customer loans rose to N1.85 trillion in 2025, the second highest among the banks behind Access Holdings Plc, contributing significantly to the bank’s total interest income of N2.99 trillion.

So far in 2026, as reflected in its Q1 2026 results, impairment charges on customers’ loans increased marginally by 1.86 per cent to N41.990 compared to N41.225 billion in Q1 2025

Zenith Bank Plc
Zenith Bank Plc recorded the highest impairment charges on loans and advances to customers, rising to N843.4 billion in 2025 from N594.2 billion in 2024.

This stemmed from a customer loan book of N10.45 trillion, representing a 4.48 per cent increase from the N9.97 trillion recorded in 2024, making it the second-largest loan portfolio among the banks.

From the loan book, Zenith earned interest income of N1.82 trillion in 2025, accounting for 49.66 per cent of the bank’s total interest income of N3.67 trillion, the highest total interest income recorded among the five banks.
The sharp rise in impairments appears linked to significant Stage 2 and Stage 3 exposures within the loan portfolio.

Stage 2 loans stood at N3.35 trillion with provisions of N634.7 billion, while Stage 3 loans amounted to N338.4 billion with provisions of N241 billion.
Despite this, the group’s capital adequacy ratio declined to 24.30 per cent in 2025 from 26.25 per cent in 2024.

The impairment charges have continued to rise in 2026, with impairment charges on loans increasing by 15 per cent to N41.68 billion in Q1 2026 compared to N35.949 billion in Q1 2025.

Overall, the 2025 results show that while FUGAZ banks continued to benefit from elevated interest rates and strong earnings from both lending and investment securities, the operating environment became more challenging.

The sharp rise in impairment charges also appears partly linked to the industry’s exit from CBN regulatory forbearance.

At the same time, the sharp rise in impairment charges across most of the banks suggests that borrower repayment pressure intensified during the year, particularly within Stage 2 and Stage 3 loan categories.

Another issue is income mix; although combined interest income rose strongly, a growing portion of earnings is now being driven by treasury bills, bonds, and other investment securities rather than traditional lending activities.

This suggests a gradual shift in strategy as banks increasingly allocate capital toward lower-risk government instruments in a high-yield environment.
The pressure on profitability was further worsened by weaker foreign exchange gains and rising operating expenses, which offset part of the strong core earnings performance.

GTCO emerged as the only outlier with a decline in impairment charges, while Zenith Bank remained the most profitable lender despite recording the highest impairment levels.

Early Q1 2026 results suggest the pressure has persisted across most of the banks, with combined impairment charges on loans and advances rising by 36 per cent year-on-year to N153 billion. However, the trend was not uniform, as GTCO again remained the only lender to record a decline in loan impairments in Q1.