Banking
Zenith Bank, GTBank Remain Strongest in Nigeria Despite Fitch Downgrade
By Modupe Gbadeyanka
GTBank and Zenith have emerged the highest rated banks in Nigeria with Long-Term IDRs and VRs of ‘B+’ and ‘b+’ respectively despite the revision of four Nigerian Banks’ Outlook to Negative by Fitch Ratings this week.
According to the world leading rating agency, the ratings of the two banks are driven by solid company profiles, management quality and strong through-the-cycle performance.
In a statement issued by Fitch on Wednesday, The IDR Outlooks on Zenith and GTB (both at B+) were revised to Negative following a recent similar action on Nigeria’s (B+) Outlook, but despite this, they still remain the highest rated banks in Nigeria.
The Negative Outlooks on their Long-Term IDRs reflect Fitch’s view that they cannot be rated above the sovereign due to the close correlation between the domestic operating environment and their credit profiles, including large holdings of government securities.
The statement noted that the IDRs of all the banks (except SIBTC/SIBTCH) are driven by Fitch’s assessment of their standalone creditworthiness as captured in their Viability Ratings (VRs).
The IDRs are all in the ‘B’ range, indicating highly speculative fundamental credit quality, and factor in the banks’ weakened credit profiles due to challenging macro-economic conditions and market volatility.
The operating environment continues to be affected by the oil price shock, slow GDP growth, continuing pressure on the naira, scarcity of hard currency in the FX interbank market and policy uncertainty.
The VRs continue to be pressured by tight foreign currency liquidity, asset quality deterioration and limited capital buffers. The sector remains largely profitable, but operating profits in 2016 were inflated by foreign currency revaluation gains (due to the sharp depreciation of the naira in June 2016). Foreign currency-adjusted ‘normalised’ operating profit, although still healthy, is vulnerable to rising loan impairment charges (LICs). As a consequence, the banks VRs remain in the highly speculative ‘b’ range.
Fitch said it is monitoring the banks’ ability to meet maturing external obligations given current difficult market conditions and limited supply of foreign currency from the Central Bank of Nigeria (CBN).
The new foreign-exchange regime has provided limited respite in accessing foreign currency in the interbank market. FX forward contracts provided by the CBN since June 2016 have helped the banks access foreign currency to reduce a large backlog of overdue trade finance obligations. These were either extended or refinanced with international correspondent banks.
Further depreciation of the naira against the US dollar would negatively impact banks’ regulatory capital ratios due to the translation effect of risk-weighted assets (RWAs). Some banks have limited buffers over regulatory minimums and further erosion of capital ratios beyond our expectations could be credit-negative.
Fitch said UBA’s VR reflects the bank’s strong franchise and company profile, which includes a broad pan-African footprint, as well as healthy financial metrics, including adequate capital and leverage ratios and resilient earnings.
Access’s VR reflects the bank’s expanding franchise and market share as well as a strengthened business model and good track-record of execution. The rating also considers the bank’s healthy financial profile, including strong asset quality and capital ratios.
FBNH’s and FBN’s VRs reflect the group’s traditionally strong franchise and company profile in Nigeria and regionally and a large retail network. The VRs also factor in the bank’s very high non-performing loans (NPL) ratio, large loan concentrations to the oil sector and weak capital position. The Outlook on the Long-Term IDRs is revised to Negative to reflect continued pressure on capital as addressing its substantial asset quality problems will likely take time.
Diamond’s VR reflects the bank’s high risk appetite and weaker earnings. The Outlook on the Long-Term IDR is revised to Negative to reflect a very tight foreign currency liquidity position and pressure on capital arising from weak asset quality.
Fidelity’s VR reflects the institution’s strong second-tier franchise and sound capital ratios as well as sensitivity to high credit concentrations and weak earnings.
FCMB’s VR reflects the bank’s limited company profile, exposure to higher-risk segments, tight foreign currency liquidity and weak earnings generation.
Union’s VR reflects a high NPL ratio compared with peers, tight foreign currency liquidity and modest, albeit improving, revenue generation. It also reflects pressure on regulatory capital ratios, which the bank intends to address by raising core capital.
Wema’s VR reflects the bank’s small franchise, modest earnings and profitability and still low capital buffers. It also reflects a lower proportion of foreign currency assets and liabilities than peers’, meaning it is less affected by current liquidity pressures.
SUPPORT RATING AND SUPPORT RATING FLOOR
The Support Ratings of ‘5’ and Support Rating Floors of ‘No Floor’ for all the banks reflect sovereign support is possible but cannot be relied upon.
Fitch said it believes that the Nigerian authorities retain a willingness to support the banks, but their ability to do so in foreign currency is weak due to Nigeria’s low foreign currency reserves and revenues. In addition, we have limited confidence that any available reserves will be used to support the banks rather than to execute other priority policy objectives.
FBNH’s Support Rating of ‘5’ also reflects Fitch’s view that the authorities retain a low propensity to provide support to bank holding companies that do not have significant senior obligations.
SENIOR AND SUBORDINATED DEBT
The senior debt ratings of Zenith, Access (issued via the bank and Access Finance BV), GTB (issued via GTB Finance BV), Diamond and Fidelity are in line with their respective Long-Term IDRs.
The subordinated debt ratings of FBN (issued via FBN Finance BV) and Access are rated one notch below their respective VRs to reflect higher-than-average loss severity for subordinated relative to senior debt. No additional notches for non-performance risk have been applied.
NATIONAL RATINGS
National Ratings reflect Fitch’s opinion of each bank’s creditworthiness relative to the best credit in the country. We have downgraded the National Ratings of FBN/FBNH and Diamond to reflect their weaker financial metrics relative to peers.
SIBTC’s and SIBTCH’s National Ratings are based on the probability of support from their parent, Standard Bank Group Limited (SBG; BBB-/Negative). SBG has a majority 53.2% stake in SIBTCH, which owns 100% of SIBTC. Fitch believes SBG’s support would extend equally to both the bank and the holding company.
RATING SENSITIVITIES
IDRS AND VRs
The IDRs are sensitive to rating action on the banks’ respective VRs. This is mostly likely to be triggered by further asset quality and capital deterioration as well as continued pressure on foreign-currency funding and liquidity.
FBN/FBNH’s and Diamond’s VRs face heightened sensitivity to a downgrade if asset quality, and therefore capitalisation, continues to deteriorate. For Diamond, additional weakening of its foreign currency liquidity position is also a rating sensitivity given its foreign currency refinancing risks.
Upside is limited for all banks’ VRs due to the difficult operating environment.
SUPPORT RATING AND SUPPORT RATING FLOOR
Upside to the SRs and SRFs of all banks is unlikely in the near term due to the recent downgrades and revisions (in November 2016). In the medium term, positive rating action could result from a significant improvement in the sovereign’s foreign-currency reserves and a significant improvement in foreign-currency liquidity in the system. It may also be triggered by clear evidence of timely extraordinary sovereign support for domestic banks, if required.
NATIONAL RATINGS
The banks’ National Ratings are sensitive to changes in their creditworthiness relative to other Nigerian entities. The National Ratings of SIBTC and SIBTCH are sensitive to a change in potential support (relating to both ability and propensity) from their ultimate parent, SBG. The National Ratings of SIBTCH and SIBTC could withstand a two-notch downgrade of SBG’s Long-Term IDR.
SENIOR AND SUBORDINATED DEBT
The senior debt ratings of Zenith, Access (issued via the bank and Access Finance BV), GTB (issued via GTB Finance BV), Diamond and Fidelity are sensitive to a change in their Long-Term IDRs.
The subordinated debt ratings of FBN (issued via FBN Finance BV) and Access are sensitive to a change in their VRs.
By Adedapo Adesanya
Nigerian tier-1 lender, Zenith Bank Plc, plans to list on the London Stock Exchange in 2027 to broaden access to capital and strengthen client services.
“There are a lot of deals we have on the table to finance across the United Kingdom and other countries, for which we need to raise more capital,” a bank official said on Tuesday, as per Bloomberg, since Zenith didn’t disclose additional details of its plan.
The move will make Zenith Bank the second Nigerian lender to list on the United Kingdom’s major exchange, following Guaranty Trust Holding Company (GTCO) Plc.
Zenith Bank, which is Nigeria’s second-largest lender by market value, has opened a branch in Manchester today in addition to the operation it already has in London.
The Manchester branch has the capacity to create up to 30 new direct jobs, a boost for the economy of the UK’s North West region.
The chief executive of Zenith Bank, Ms Adaora Umeoji, said, “The United Kingdom remains a key global financial centre. The opening of Zenith Bank, Manchester, therefore, marks another important milestone in our international expansion strategy, enabling us to deepen relationships with our customers, support trade and investments, and connect businesses between Africa and the UK more effectively.”
Last year, the bank raised its capital above the N500 billion minimum requirement set by the Central Bank of Nigeria (CBN), and announced plans to expand in francophone West Africa.
Founded in 1990 by Mr Jim Ovia, Zenith Bank has grown into one of Africa’s most respected banking institutions, boasting a robust capital base and a remarkable history of year-on-year profitability.
Headquartered in Lagos, Nigeria, Zenith Bank operates over 500 branches and business offices across the 36 States of the Federation and the Federal Capital Territory (FCT).
The bank currently operates subsidiaries in several African countries, including Ghana, Sierra Leone, Gambia, and Cote d’Ivoire, while maintaining a presence in major international financial centres, including the United Kingdom, France, the UAE and China.
By Adedapo Adesanya
The Central Bank of Nigeria (CBN) has waived the affidavit requirement for reactivating dormant bank accounts to unlock billions of Naira trapped in inactive accounts, boost financial inclusion, and reduce compliance costs for customers amid ongoing economic reforms.
In a circular issued to banks and other financial institutions, the apex bank said the decision followed representations from stakeholders who had raised concerns about the administrative burden associated with affidavit requirements.
The directive was contained in a circular titled Guidelines on the Management of Dormant Accounts, Unclaimed Balances and Other Financial Assets in Banks and Other Financial Institutions in Nigeria, dated March 12, 2026.
The new directive supersedes an earlier circular issued on February 17, 2025, and takes immediate effect.
According to the circular signed by the director of the Financial Policy and Regulation Department, Rita I. Sike, the revised framework allows banks and other financial institutions to accept dormant account reactivation requests via alternative channels, provided adequate risk management measures are in place.
The CBN stated that the existing guidelines mandate banks and other financial institutions to implement specific measures and disclosures regarding dormant accounts, unclaimed balances, and other financial assets to improve transparency and facilitate the reunification of funds with their rightful owners.
“The guidelines are designed to enhance transparency, facilitate the reunification of funds with their rightful owners, and ensure full compliance with applicable legal and regulatory frameworks,” the CBN said.
Under the new directive, banks must still maintain strict identification and verification processes when handling requests to reactivate dormant accounts.
“In addition to the in-person submission of reactivation requests required under Section 8.0(i) of the Guidelines, banks and other financial institutions shall adopt alternative channels for receiving requests for the reactivation of dormant accounts,” the circular stated.
However, the apex bank emphasised that institutions must implement appropriate risk management strategies, including robust identification and verification measures, to ensure that the individual making the request is properly authenticated.
“Following representations received from stakeholders, the CBN hereby rescinds the requirement under Section 8.0(ii) for the mandatory use of affidavits in the reactivation of dormant accounts,” the circular said.
Despite the removal of the affidavit requirement, the regulator directed banks to apply enhanced due diligence procedures when processing reactivation requests.
The CBN clarified that the removal of affidavits applies only to dormant accounts that have not yet been transferred to the Unclaimed Balances Trust Fund Pool Account.
“For the avoidance of doubt, affidavits are no longer required for reactivating dormant accounts that have not been transferred to the UBTF Pool Account,” the regulator said.
However, customers seeking to reclaim funds already transferred to the Unclaimed Balances Trust Fund Pool Account will still be required to present affidavits in accordance with the existing guidelines.
“This rescission does not extend to the reclaiming of funds already transferred to the UBTF Pool Account, where affidavits remain mandatory,” the circular noted.
Beyond the reactivation process, the CBN also strengthened disclosure requirements relating to dormant accounts and unclaimed balances.
Banks and other financial institutions have been directed to publish specific information on their operational websites regarding dormant accounts that have not yet been transferred to the UBTF Pool Account, as well as unclaimed balances already transferred to the fund.
The information to be disclosed includes the names of authorised account holders, the type of account, the name of the financial institution and the branch where the account is domiciled.
Financial institutions that do not maintain operational websites must publish the information on the official websites of their respective industry associations.
In addition, the CBN directed banks and other financial institutions to publish the mandated information annually in at least two national daily newspapers.
Where such disclosures exceed two full pages, institutions may instead publish a single-page notice in at least two national newspapers, directing customers to a dedicated, easily searchable section of their corporate websites containing the full list of dormant accounts.
The regulator, however, provided exemptions for smaller institutions. State and unit microfinance banks are only required to display the information at their business locations and are not mandated to publish the details in national newspapers.
The CBN also addressed concerns raised by financial institutions regarding compliance with Nigeria’s data protection framework.
The regulator explained that the disclosure requirements are consistent with the provisions of the Nigeria Data Protection Act, 2023, which permits the processing of personal data where it is necessary for compliance with a legal obligation or the protection of the vital interests of individuals.
It further cited Section 72(11) of the Banks and Other Financial Institutions Act (BOFIA, 2020), which empowers the CBN to issue guidelines on the administration of unclaimed funds in banks and other financial institutions.
“Accordingly, the required disclosures are legally justified and fully consistent with the applicable provisions of the NDPA and BOFIA,” the apex bank said.
By Aduragbemi Omiyale
A former Deputy Managing Director of First Bank of Nigeria, Mr Gbenga Shobo, has been appointed to the board of FairMoney Microfinance Bank as chairman.
This appointment is part of the strategies deployed by the small technology-driven financial institution to strengthen corporate governance.
In a statement made available to Business Post on Tuesday, it was disclosed that a former chief executive of Letshego Microfinance Bank, Mr Debo Aderoju, has also been appointed to the board as an executive director and Chief Risk Officer.
The chief executive of FairMoney, Mr Henry Obiekea, said the appointment of the duo “reinforces our commitment to transforming FairMoney into a market-leading financial institution.”
“Mr Shobo joins our board with extensive experience in managing complex operations and a deep understanding of the retail and tech-enabled sectors, which will be invaluable as we continue to expand our services and deliver even greater value to our customers.
“In addition, Mr Aderoju’s strong expertise in governance and inclusive finance will serve as a key driver for enhancing operational efficiency, risk management and regulatory compliance,” he added.
Mr Shobo brings to the board over 35 years of experience in the banking industry. During his tenure at First Bank, he played a pivotal role in driving remarkable growth in digital banking volumes and supervised business units that generated significant portions of the bank’s total revenue.
An alumnus of the University of Ife, Harvard Business School, Stanford University and INSEAD, He has also served on the boards of various financial institutions, including microfinance, insurance and fintechs, highlighting his experience across diverse segments of the financial services ecosystem.
Renowned for his strategic insight, governance acumen, and boardroom expertise, his appointment is expected to further strengthen the bank’s governance architecture and provide strong strategic oversight as FairMoney continues to expand its footprint in Nigeria’s financial services landscape, while upholding the highest ethical standards.
On his part, Mr Aderoju is a banking professional with more than two decades of experience in credit management, enterprise risk management, and inclusive finance.
Earlier in his career, he worked at United Bank for Africa and later moved to First Bank of Nigeria Limited, where he oversaw risk management functions across multiple Sub-Saharan African markets. His appointment is subject to regulatory approval.
He is an alumnus of the Leadership Development Program at the Gordon Institute of Business and Science (GIBS), University of Pretoria, South Africa, and the Massachusetts Institute of Technology.
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