Nigerian Banks Lose Steam as East and North African Lenders Take Over

Nigerian banking sector, once the continent's standout profit story, is losing momentum. After posting record earnings over the past two years on the back of naira devaluation gains and elevated interest rates, the country's biggest lenders are now facing a sharp reality check. Profit growth is slowing, impairment charges are rising, and the extraordinary gains generated by macroeconomic distortions are fading.

Meanwhile, lenders from Kenya, South Africa, Egypt, and Morocco are extending their earnings growth. These banks have benefited from more stable currencies, diversified revenue streams, and stronger consumer lending markets. Analysts say the shift marks a rebalancing of Africa's banking landscape.

For Nigerian banks, the challenge is clear. The one-off gains from naira depreciation are behind them. With inflation still high and credit risk climbing, the sector must now focus on core lending and cost control. Investors are watching closely.