Eight Nigerian banks have reported a notable 46.9 percent decrease in loan impairment charges, totaling N1.01 trillion for the nine months ending September 2026. This figure is down from N1.91 trillion during the same period in 2025. Loan impairment charges, which are also known as credit losses, represent the provisions banks set aside for potential defaults and changes in the value of their financial assets.
The substantial reduction in impairment charges has contributed to a 12.2 percent increase in the combined profit before tax (PBT) of these banks, which now stands at N4.8 trillion, up from N4.3 trillion a year earlier. The banks involved include Jaiz Bank Plc, Zenith Bank Plc, Ecobank Transnational Incorporated, First HoldCo Plc, Guaranty Trust Holding Company (GTCO) Plc, Access Holdings Plc, Wema Bank Plc, and Sterling Financial Holdings Plc.
Lower impairment charges at GTCO, Access Holdings, Zenith Bank, and First HoldCo were key to their improved profitability, although the sources of earnings growth varied among the institutions. Access Holdings reported the largest decrease in impairment charges, down 73.5 percent to N92.91 billion, resulting in an 8.3 percent rise in PBT to N667.36 billion. Zenith Bank followed with a 70.5 percent reduction in impairment charges, down to N230.77 billion, whereas its PBT increased by 1.2 percent to N928.80 billion.
Collectively, Zenith Bank and Access Holdings accounted for approximately N809 billion of the total N906 billion reduction in impairment charges across these banks. Additionally, GTCO saw a reduction of around N39.6 billion in impairment charges, although its PBT fell by 2.3 percent to N879.90 billion.
The financial results indicate that while lower impairment charges can significantly enhance earnings, they do not always result in higher profits if other income sources decline or expenses rise. For instance, First HoldCo achieved a PBT of N911.24 billion, a 60.8 percent increase, despite a 16 percent drop in net interest income, thanks to rising trading and non-interest income.
Wema Bank also experienced a significant PBT rise of 76.6 percent to N258.64 billion, supported by a 38.3 percent increase in net interest income. Similarly, Sterling Financial Holdings recorded a PBT increase of 37.1 percent to N97.28 billion, despite facing rising impairment charges and operating expenses.
Meanwhile, Ecobank’s naira-denominated PBT slightly decreased to N1.01 trillion due to weaker operating income, while GTCO noted a dip in PBT attributed to higher funding costs and operating expenses. Jaiz Bank, however, reported a slight increase in impairment charges to N1.28 billion and a PBT rise of 1.7 percent to N23.69 billion.
