Why Nigeria’s Oldest Bank’s Profit Fell to Eight-Year Low
FirstHoldCo Plc, Nigeria’s oldest banking group, posted its lowest profit in eight years in 2025 after taking a massive one-off hit from legacy bad loans, underscoring the cost of cleaning up years of impaired assets.
The parent company of FirstBank reported that profit after tax plunged by 92.1 percent to N52.8 billion in 2025 from N663.5 billion in 2024, according to its latest audited results released on Friday. The last time the group saw earnings below last year’s figure was in 2017 (N47.7 billion).
The decline was driven largely by a 74.8 percent surge in impairment charges, which rose to N748.1 billion from N426.3 billion a year earlier, as the group aggressively wrote off non-performing loans accumulated over several years.
Despite the heavy provisioning, the bank’s core earnings remained resilient. Interest income rose to N2.96 trillion from N2.39 trillion, while interest expenses increased modesty by 5.4 percent to N1.05 trillion. Profit before tax, however, fell sharply to N229.0 billion from N796.5 billion in 2024.
A painful but necessary cleanup
Commenting on the results, Femi Otedola, chairman of FirstHoldCo, said the group deliberately absorbed the losses to reset the balance sheet ahead of a tougher regulatory environment.
“We took a huge one-time hit of N748 billion to admit old bad loans instead of pretending they do not exist,” Otedola said in a post on social media platform X on Saturday. “That is why profit looks like it crashed by 92 percent. Painful headline, but it is a serious long-term move.”
He added that the clean-up was in line with pressure from the Central Bank of Nigeria for lenders to stop deferring asset quality problems. “FirstHoldCo basically closed the chapter on messy loans from past years. It sends a clear message that borrowing has consequences and helps rebuild trust,” he said.
The country’s fourth richest man stressed that the underlying business remains strong. “The key point is this: our business itself is still strong. It generated N2.96 trillion in interest income and N1.91 trillion in net interest income, which gave us the capacity to take this hit and stay standing.”
According to him, the group is entering 2026 “lighter, cleaner and better prepared” for Nigeria’s banking recapitalisation drive and the next phase of growth.
Otedola raises stake
The results come amid deeper shareholder commitment from Otedola. The group disclosed that he increased his stake to 18.12 percent in 2025, after acquiring 3.82 billion additional shares worth about N14.8 billion.
Otedola now holds 8.05 billion shares in FirstHoldCo, up more than 90 percent year-on-year from 4.23 billion shares, or an 11.8 percent stake, recorded in 2024—cementing his position as one of the group’s largest shareholders.
