Following the sector’s recapitalisation exercise by the Central Bank of Nigeria (CBN), the banking stocks have witnessed surge demand this year, closing its Year-till-Date (YtD) with a gain of 48.5per cent as of July 2025 to outperformed others indices on the Nigerian Exchange Limited (NGX). Our correspondent gathered detailed trajectory growth of these banking stocks on NGX in seven months of 2025.
Between December 31, 2024 and July 31, 2025, NGX Banking Index has gained 48.5per cent is higher than the overall market indicator, the NGX All-Share Index returns that closed July 31 , 2025 at 35.88 per cent.
After a double-digit capital gain in 2024, Nigerian banking stocks are showing another remarkable bullish year as most of the offers raised, according to the Central Bank of Nigeria (CBN) directive have been oversubscribed by investors and listed on the NGX.
How the Banking stocks have appreciated in seven months 2025
According to investigation, Wema Bank, followed by FCMB Group Plc, and Stanbic IBTC Holdings Plc led other banking stocks in price appreciation in the seven months of 2025.
Wema Bank’s stock price has appreciated by 141.76 per cent to close July 2025 at N22.00per share from N9.10 per share the stock opened for trading in 2025.
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With an outstanding share of 36,425,229,514.00, GTCO’s market capitalisation stood at N3.66 trillion on NGX as of July 2025, making it the most capitalised financial institution on Exchange.
GTCO, in July 2025 makes history when its stock price crossed the N100 mark after a successfully listing on London Stock Exchange (LSE).
In the seven months under review, Stanbic IBTC Holdings saw its stock price at N101.00 per share as at the close of trading activities in July 2025, 75.35 per cent increase over N57.60 per share it opened for trading in thee year under review.
Only Wema Bank of the three banks have released unaudited financial statement for half ended July 30, 2025.
Wema Bank declared Profit Before Tax (PBT) of N101.2 billion in H1 2025, representing a 231per cent increase compared to N30.55 billion recorded in the corresponding period of H1 2024.
Zenith Bank ranked fourth as the highest yield in the period under review, gaining 68.13per cent to close July 2025 at N76.5per share from N45.5 per share it closed for trading in n2024.
UBA gained 45.88 per cent to close at N49.60 per share from N34.00 per share; Ecobank’s stock price increased by 33.75 per share to close N37.45 per share from N28.00 per share; Jaiz Bank’ closed July 2025 at N3.81 per share, about 27 per cent growth from N3.00per share and Sterling Financial Holdings Company’s stock price added 25 per cent to close at N7.00 per share from N5.60per share it closed for trading in 2024.
In addition, the stock price of Fidelity Bank gained 20.29 per cent to close July 2025 at N21.05 per share from N17.50 per share; Access Holdings appreciated by 16.98 per cent to close July 2025 at N27.90 per share from N23.85 per share; First Holdco’s stock price advanced by 14.97 per cent to close at N32.25 per share from N28.05 per share and FCMB Group gained 6.38 per share to close at N10 per share from N9.40 per share.
What is driving banking stocks on NGX
The banking stocks on NGX have reacted positively to the sector recapitalisation exercise of the CBN.
The CBN in March 2024 released its circular on review of minimum capital requirement for commercial, merchant and non-interest banks. The apex bank increased the new minimum capital for commercial banks with international affiliations, otherwise known as mega banks, to N500 billion; commercial banks with national authorisation, N200 billion and commercial banks with regional license, N50 billion.
Others included merchant banks, N50 billion; non-interest banks with national license, N20 billion and non-interest banks with regional license will now have N10 billion minimum capital. The 24-month timeline for compliance ends on March 31, 2026.
Under the new minimum capital base, CBN uses a distinctive definition of the new minimum capital base for each category of banks as the addition of share capital and share premium, as against the previous use of shareholders’ funds.
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While most banks have shareholders’ funds in excess of the new minimum capital base, their share premium and share capital significantly fall short of the new minimum definition. This implies that nearly all banks will need to beef up their capital base to meet the new definition of qualified capital.
The Securities and Exchange Commission (SEC), the apex capital market regulator, had confirmed that banks raised some N1.7 trillion in new equity funds, in less than one-third of the current recapitalisation timeline.
The likes of United Bank for Africa Plc (UBA), Stanbic IBTC Holding , Zenith Bank Plc, Access Holdings Plc, FCMB Group Plc, Fidelity Bank Plc have successfully raised capital and announced their listings on NGX.
However, Zenith Bank, Access Holdings , Wema Bank, Jaiz Bank, and Stanbic IBTC Holding are listed financial institution that have successfully completed their recapitalisation requirements.
Guaranty Trust Holding Company (GTCO), that is yet to complete its capital raising exercise, as other Nigerian banks are seeking to raise nearly N2 trillion in a new round of capital raising as the banking sector’s recapitalisation heads into its final year.
GTCO earily in the year announced that it raised N209 billion out of its recent N400.5 billion public offer. launched a public offer of 9.0 billion ordinary shares of 50 kobo each at N44.5 per share. The lender had announced receipt of regulatory approval for a total of N209.41 billion, representing 52.3 per cent of the total offer size.
In July 2025, it announced to investing public it has successfully priced its new $105 million equity offering on the LSE.
A total of approximately 2.29 billion new shares in the Company will be issued in US dollars at a reference price of 70.00 Naira per share ($0.0459), raising gross proceeds of $105 million.
UBA, also in July 2025 launched a rights issue to raise N157.85 billion, aimed at strengthening its capital base and meeting regulatory requirements.
UBA, Sterling Financial Holdings Company, FCMB Group, First Holdco, are in fresh capital hurdle to cluster in the third quarter of 2025 with offers from new issuers and previous issuers seeking to close their recapitalisation gaps.
For First HoldCo, the oldest financial institution had listed an additional 5,982,548,799 ordinary shares of 50 Kobo each after thee completion of its Rights Issue.
With this new listing, the company’s total issued and fully paid-up share capital has increased from 35,895,292,792 to 41,877,841,591 ordinary shares of 50 Kobo each, further positioning First HoldCo Plc for enhanced capital market visibility and future growth initiatives.
Sterling Financial Holdings Company had secured its shareholders’ approval to raise up to $400 million.
On June 19, Sterling announced plans to raise $400 million through a rights issue, a public offering, and a private placement.
In a corporate notice dated July 14, signed by Adeyoola Temple, the company secretary, the company confirmed that the resolution was passed at its 2nd annual general meeting (AGM), held on July 11.
The bank said the capital will be raised through the establishment of a shelf programme.
The fate of Unity Bank Plc already sealed as the leading retail bank in Nigeria had announced merger with Providus Bank. Providus Bank , a non listed financial institution has joined others to meet the CBN fresh capital requirement.
Stakeholders reaction on what is driving NGX, banking stocks
On the 35.88 per cent YtD stock market performance, the Managing Director, Globalview Capital Limited, Mr. Aruna Kebira said, “The entry into the year 2025 is remarkably different from that of 2024. Last year started with the adjustment of the MPR upwards by 600 basis points.
“The growth in the relevant microeconomic variables started their ascent on that note. However, in 2025, the first news about any microeconomic variable was that of inflation growing by 20 basis points. At that, the market has discovered that the numbers are growing at a decreasing rate. This was followed by the rebating of inflation by the NBS.
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“The resultant drop in the numbers from 34.80 to 22.22 per cent inflation rate was another testimony that 2025 is set out to be different from 2024. Moreso, the CBN retained all the rates in its first meeting of 2025. The market is believing the relevant rates will tank in 2025. Inflation figures spiked in 2024, using the year as the new base year, the number for inflation has no other option than to decline.”
He added that, “Dangote refinery is still in the business of reducing the pump price of Premium Motor Spirit. Now selling at average of N825 from N1, 100 from 2024, it is a matter of time, prices affected by the increase in petrol price will begin to temper. The period between January and March each year is earning and dividend declaration season.
“The market, an nay, investors also factored in pricing equities. The UFS and the AFS released so far into the market are far from being labelled lacklustre. The primary market auction of both the TBs and Bonds is interpreting the government body language of apathy to borrow. The stop rate for Bonds was 19per cent, while that for tmTBs was 18per cent.
“The participants in that space, if the rates continue to drop, will be faced with reinvestment risks, and the available investment destination then would be the stock market.”
Investment banking experts said with the strong start and continuing investors’ appetite for banking stocks, banks are on stronger footing to retain their licences.
Experts noted that banks have the advantages of enthusiastic existing shareholders and new investors, including foreign investors who have shown stronger appetite for Nigerian stocks in recent period.
The Managing Director, Globalview Capital Limited, further explained that the expectations in the capital market is that banks would largely be able to meet their capital requirements, citing the enthusiasm shown so far, as indicated by the 2024 offers.
According to him, banks have a lot of positive things going for them, which place them in better position to substantially outperform the 2004 recapitalisation scenario.
“In 2004, when the same exercise was foisted on the sector, we saw a lot of business combinations in the form of mergers and acquisitions. But after the general market meltdown, regulation has gone to a higher level.
“In 2025, the exact of what happened then is not expected. Quarterly and yearly earnings from the banking sector have been reflecting the true position of operations, which was opposite 21 years ago.
“To a very large extent, the market is not expecting any merger and acquisition as it believes that each bank would rise to the occasion and do the needful.
“Recapitalisation must not necessarily be from rights issues and public offers only. It could be from private placement and other strategic investments,” Kebira, a senior investment banker, said.
He noted that banks’ resilient earnings and ability to optimize shareholders’ value would support the sector’s recapitalisation exercise.
According to him, investors are looking beyond the current share pricing and macroeconomic situation into post-recapitalisation period, when banks would be bigger and in better position to deliver higher returns.
“The market is also looking towards a better outing for the banks after the recapitalisation exercise. It believes that more investable funds would be at their disposal and for what the sector is known, such funds would be judicious deployed. At that point, they will generate commensurate earnings to counter the increase in the share capital base and the dilution in the earnings per share (EPS).
“The market has also noted that the banking sector has been paying less than 50 per cent of their EPS as dividends and as such, while the exercise is concluded and the effect of the funds has not fully reflected in their operations, they would still be able to pay commendable dividend,” Kebira said.
The Vice President, Highcap Securities Limited, Mr. David Adnori said the banks still have enough time to be able to raise funds and meet their recapitalisation target.
“The period to conclude recapitalisation is still over a year, so it is too early to assume merger. We are hoping other banks will come to the capital market and be able to meet up their capital requirements,”Adnori, a senior stockbroker on NGX added.
