Nigeria’s Tier-1 Banks in 2026: Earnings Growth, Share Price Performance and What Investors Should Expect Next

Nigeria’s Tier-1 banks have once again positioned themselves at the center of investor attention in 2026, as the country’s largest lenders continue to demonstrate resilience amid macroeconomic uncertainty, elevated interest rates, exchange rate volatility and regulatory adjustments. The so-called “FUGAZ” banks —FirstHoldCo, UBA Group, GTCO, Access Holdings, and Zenith Bank entered the year on the back of record-breaking 2025 earnings, improved balance-sheet quality, and renewed investor confidence in banking stocks on the Nigerian Exchange (NGX).

The sector has benefited significantly from high yields on government securities, strong interest income expansion, FX-related gains and aggressive digital banking penetration. Despite concerns over the Central Bank of Nigeria’s tighter regulatory stance and the gradual phase-out of regulatory forbearance measures, the banking industry has maintained impressive profitability metrics, reinforcing its position as one of the strongest sectors on the NGX in 2026.

Strong Q1 2026 Earnings Reinforce Sector Resilience

The first quarter of 2026 showed that Nigeria’s leading banks remain fundamentally strong. Combined profit before tax across seven major banks rose to approximately N1.6 trillion in Q1 2026, representing a 6.77% increase year-on-year, while the combined profit after tax for these major lenders rose more modestly by 1.8% reaching N1.27 trillion. Analysts attributed the performance to elevated net interest margins, improved loan growth, stronger non-funded income and lower impairment pressures across the sector.

The performance further strengthened investor confidence in banking stocks, particularly as the broader market continues to search for sectors capable of delivering earnings stability and strong dividend returns amid economic uncertainty.

Zenith Bank Maintains Leadership Position

Zenith Bank retained its position as Nigeria’s most profitable lender in the first quarter of the year after reporting a profit before tax of N360.92 billion, up from N350.82 billion recorded in the corresponding period of 2025. Profit after tax also increased to N314.02 billion despite rising operating costs and impairment charges. The bank continues to maintain one of the strongest capital and liquidity positions in the industry, reinforcing investor confidence in its long-term stability. Analysts expect Zenith’s earnings per share to rise from N26.82 in FY2025 to N38.70 in FY2026 as loan regularization and improved profitability strengthen earnings quality.

The bank also sustained its reputation as one of the market’s strongest dividend-paying institutions. Following its FY2025 performance, Zenith proposed a final dividend of N8.75 that pushed total dividend payout expectations to one of the highest levels in the banking sector, further solidifying its attractiveness to income-focused investors. The stock has also maintained strong momentum on the NGX trading above N100 per share amid renewed institutional interest in banking equities. It became the first Nigerian bank to cross the N5 trillion market capitalization mark in April 2026

GTCO Continues to Deliver Stable Growth

GTCO also delivered another strong quarter, posting a profit before tax of N302.89 billion in Q1 2026, marginally above the N300.30 billion reported in Q1 2025. Although earnings growth moderated compared to the explosive expansion witnessed during the peak FX revaluation era, GTCO’s results reflected stronger core banking income and increasing contributions from its non-banking subsidiaries and ecosystem businesses. Management noted that the group’s strategic focus remains centered on sustainable earnings growth, digital banking expansion and improved customer experience.

GTCO remains one of the market’s preferred banking stocks due to its strong return on equity, disciplined risk management and consistent dividend culture. Analysts expect the group to sustain payout ratios above 30% through 2026 while also benefiting from renewed loan growth following the resolution of legacy assets and balance sheet restructuring.

Access Holdings Emerges as a Major Growth Story

Access Holdings recorded one of the strongest earnings expansions among the Tier-1 lenders in the first quarter of the year. The group reported a 22.2% increase in profit before tax to N272.21 billion from N222.78 billion in Q1 2025. The performance was driven by continued growth across its pan-African operations, stronger interest income and improving operational efficiency following years of aggressive acquisitions and expansion.

Analysts believe Access Holdings could emerge as one of the best-performing Tier-1 banking stocks in 2026 due to its significant valuation discount relative to peers. CardinalStone Research projected a potential total return of over 92% for the group over a one-year period, supported by earnings recovery, improved efficiency and stronger dividend prospects. Despite delivering a return on equity of 17.4%, Access still trades at a price-to-book ratio significantly below the EMEA peer average, suggesting considerable upside potential if investor sentiment improves further.

UBA Leverages Its Pan-African Strength

UBA Group, while still maintaining strong profitability, reported a softer first-quarter performance relative to peers. Profit before tax declined to N160.66 billion from N204.3 billion in Q1 2025, reflecting a decline of 21.35%, as a result of pressure from foreign exchange normalization and a tougher operating environment across some African markets. Nevertheless, analysts remain optimistic about the group’s outlook due to its strong pan-African footprint, improving asset quality and resilient digital banking operations.

CardinalStone analysts projected total returns of approximately 48% for UBA in 2026, supported by capital appreciation and dividend yields estimated around 7.7%. The bank remains one of the most strategically positioned financial institutions in Africa due to its extensive continental presence and growing transaction banking business.

FirstHoldCo’s Turnaround Gains Momentum

FirstHoldCo, has arguably delivered one of the most remarkable turnaround stories in the banking sector. After enduring elevated impairment charges and legacy asset quality challenges in 2025, the group entered 2026 with a significantly cleaner balance sheet and stronger capital base following its recapitalization efforts. Although FY2025 impairments of about N748.1 billion weighed heavily on earnings, analysts believe the worst of the clean-up cycle is over, creating room for stronger profitability and lower credit losses in 2026.

Investor optimism surrounding FirstHoldCo has already reflected in its share price performance. The stock rallied more than 32% within one month ahead of its Q1 2026 results, outperforming several Tier-1 peers including GTCO, Zenith Bank and Access Holdings. Market analysts believe the lender’s valuation rerating may still be in its early stages, particularly as balance sheet repair and capital strengthening continue to improve investor confidence.

Banking Stocks Continue to Drive NGX Performance

Banking stocks have broadly remained among the best-performing equities on the Nigerian Exchange in 2026, supported by renewed foreign portfolio interest, strong dividend expectations and improved macroeconomic sentiment. Investors have increasingly rotated into banking equities as inflationary pressures and high interest rates continue to support industry margins.

The sector’s recapitalization exercise has also strengthened confidence in the long-term stability of the industry while positioning banks for larger lending capacity and regional expansion opportunities.

Key Trends That Could Shape the Rest of 2026

Looking ahead to the rest of 2026, analysts expect the banking sector to remain fundamentally resilient despite several emerging risks. The gradual normalization of FX-related windfall gains may reduce the extraordinary earnings growth recorded in previous years, placing greater emphasis on core banking operations, loan growth and operational efficiency. However, lower impairment charges, stronger credit expansion and improving macroeconomic conditions are expected to support sustainable earnings growth across the sector.

Another major expectation to shape the sector during the remainder of the year is recapitalization. Nigerian banks continue to raise fresh capital to meet new regulatory thresholds introduced by the Central Bank of Nigeria. While the exercise may create short-term dilution concerns for some lenders, analysts believe stronger capital buffers will ultimately improve long-term profitability, increase lending capacity and enhance investor confidence.

Dividend Strength Remains a Major Attraction

Dividend sustainability will also remain a major attraction for investors. In a market environment where fixed income yields are moderating and inflation remains elevated, Tier-1 banking stocks continue to provide an attractive combination of dividend income and capital appreciation potential.

Analysts expect Zenith Bank, GTCO and UBA to remain among the strongest dividend-paying institutions on the NGX, while Access Holdings and FirstHoldCo may offer stronger upside potential due to valuation discounts and recovery-driven growth.

Outlook for Nigeria’s Tier-1 Banking Sector

Overall, Nigeria’s Tier-1 banking sector appears positioned for another strong year in 2026. Although earnings growth may moderate compared to the extraordinary gains recorded during the peak FX revaluation cycle, the industry’s stronger balance sheets, recapitalisation progress, resilient core banking income and improving asset quality suggest that the sector remains one of the most attractive investment destinations on the Nigerian Exchange.

For investors seeking a blend of earnings stability, dividend strength and long-term growth potential, Nigeria’s leading banks continue to stand out as some of the market’s most compelling opportunities.