Nigeria’s leading banking groups are entering a more demanding phase of international expansion, as foreign subsidiaries become increasingly important to earnings while the management of overseas investments, regulatory compliance and shareholder returns emerges as a defining test of their strategies.
For Access Holdings Plc and United Bank for Africa Plc (UBA), the shift is particularly pronounced. Their international franchises have become substantial contributors to group profitability, giving them access to earnings streams beyond Nigeria’s borders but also increasing the importance of how capital is allocated, risks are managed and profits are converted into returns for investors.
Foreign subsidiaries contributed approximately 77 percent of UBA’s group net income in 2025, compared with 44 percent in 2024, according to Fitch Ratings. At Access, the contribution rose to 48 percent in 2025 from 30 percent in 2021. Foreign operations accounted for 52 percent of UBA’s total assets and 51 percent of Access’s assets at the end of last year.
The figures capture a structural shift in the economics of Nigerian banking. International operations are no longer merely supporting businesses at home; for some of the country’s largest lenders, they are becoming central to the generation of group earnings.
But the growing importance of foreign subsidiaries also brings a more complicated question into focus: can Nigeria’s banking giants turn their international reach into durable competitive advantages without allowing the capital requirements, regulatory obligations and operating risks of cross-border expansion to undermine shareholder value?
This question has become urgent as the naira’s depreciation has increased the reported contribution of foreign-currency assets and earnings, Nigerian banks have adjusted to a new minimum-capital regime, and Access has begun reducing its stake in an overseas subsidiary amid a disclosed foreign-investment exposure above the limit it identified under Nigerian banking legislation.
The outcome will help shape the next phase of competition among Access, UBA, Guaranty Trust Holding Company Plc (GTCO) and Zenith Bank Plc, whose differing combinations of domestic strength and international reach offer investors distinct routes to profitability.
International banking becomes central to the earnings equation
The expansion of Nigerian banks across Africa and other international markets has been driven by the search for new customers, trade-finance opportunities, corporate relationships and diversification beyond the domestic economy.
The strategy has also benefited from opportunities to acquire established banking businesses as some international lenders reduce their exposure to African markets.
Fitch’s September 2026 assessment of African banking groups found that foreign subsidiaries have become increasingly important to the earnings and asset bases of major lenders over the past decade. Acquisitions have accelerated the trend, while the depreciation of the naira in 2023 and 2024 has amplified the contribution of foreign operations to Nigerian groups when their results are translated into domestic currency.
For Access, the acquisition of Mauritius-based AfrAsia Bank, completed in July 2025, was a significant addition to its international network. The group has also expanded through acquisitions of banking businesses previously owned by Standard Chartered in several African markets.
UBA has developed a broad network spanning African markets and international financial centres, giving it access to customers and commercial flows extending beyond Nigeria.
These networks offer potential benefits that reach beyond earnings diversification. Banks operating across multiple markets can support businesses trading between African economies, serve multinational companies and deepen relationships with customers whose financing and payment needs cross national borders.
They can also reduce dependence on any single domestic market, although the degree of protection depends on the economic conditions and risk profiles of the countries in which they operate.
The distinction is important. International expansion can improve the resilience of a banking group, but it does not eliminate exposure to credit losses, currency volatility, funding pressures or regulatory intervention.
Nor does a higher foreign earnings contribution necessarily mean that an overseas business has become more profitable in absolute terms. UBA’s 77 percent contribution in 2025, for example, was amplified by weaker domestic performance, according to Fitch.
For investors, the changing earnings mix therefore demands a more detailed assessment of the sources of profit, the capital supporting them and the risks attached to each market.
The naira effect: A larger franchise, a more complex calculation
The sharp depreciation of the naira in 2023 and 2024 increased the domestic-currency equivalent of foreign assets and earnings held by Nigerian banking groups.
Where a bank acquired an overseas business when the naira was stronger, the foreign-currency value of that investment may now translate into a substantially larger naira amount. Foreign-currency earnings can similarly contribute more to reported group income when converted into naira.
This has increased the apparent scale of international banking franchises and reinforced their importance in the financial results of major Nigerian lenders.
But currency translation should not be confused with organic growth, realised gains or cash available for distribution.
A larger naira equivalent does not necessarily mean that the underlying business has generated more foreign-currency profit, improved its return on invested capital or created additional distributable cash.
The currency movement can also complicate the regulatory treatment of foreign investments when qualifying holdings are assessed against shareholders’ funds.
For banks whose overseas investments have grown through acquisitions, the challenge is therefore twofold: preserve the commercial value of foreign subsidiaries while ensuring that the capital committed to them remains consistent with applicable regulatory requirements.
That tension is now particularly visible at Access Holdings.
Access’s Ghana sell-down puts capital discipline in focus
Access Holdings has disclosed foreign-investment exposure of approximately 19.3 percent against the 10 percent limit it identified under Section 19(8)(c) of the Banks and Other Financial Institutions Act.
Management has linked the outstanding regulatory requirements to the group’s inability to secure approval for its FY2025 dividend. It has also indicated that it is pursuing capital optimisation and other measures to address the exposure.
The development illustrates how an international expansion strategy can create challenges beyond the commercial performance of the acquired businesses.
Access’s overseas operations contributed approximately 48 percent of group net income in 2025 and accounted for 51 percent of group assets at year-end. Reducing qualifying foreign-investment exposure while retaining the earnings capacity of those businesses is therefore a strategic balancing act.
In July 2026, Access Bank sold 12,085,318 shares in Access Bank Ghana, representing 7.44 percent of the subsidiary’s issued shares. Its ownership fell from 93.40 percent to approximately 85.96 percent, leaving it with a controlling stake. The transaction received the relevant regulatory approvals, including a no-objection from the Bank of Ghana.
The sale demonstrates that a banking group can reduce its equity stake in an overseas subsidiary without withdrawing from the market or surrendering operational control.
It is a tangible step towards rebalancing the group’s international ownership structure. However, the transaction alone does not establish that Access has brought its overall qualifying foreign-investment exposure within the applicable limit. That determination depends on the relevant regulatory calculation and subsequent disclosures.
The commercial importance of retaining its overseas businesses is evident in the group’s first-quarter 2026 figures. Access Bank UK reported profit after tax of ₦83.8 billion, compared with ₦52 billion for the Nigerian banking operation.
The comparison highlights the growing importance of international earnings within Access, although individual subsidiary results must be distinguished from consolidated group performance.
The group’s immediate challenge is to achieve regulatory compliance without unnecessarily weakening a network that has become a substantial contributor to profitability. The longer-term test is whether integration, operational efficiencies and more disciplined capital allocation can turn that network into sustainable value for shareholders.
UBA’s foreign earnings raise the stakes for transparency
UBA’s international earnings profile is even more pronounced.
Foreign subsidiaries contributed approximately 77 percent of group net income in 2025, compared with 44 percent in 2024, and accounted for 52 percent of total assets at the end of the year.
That gives UBA a substantial earnings base across multiple markets, but the contribution must be assessed alongside the performance of its Nigerian business and the capital required to support its overseas operations.
A preliminary examination of UBA’s FY2025 audited parent-bank accounts indicates foreign-subsidiary investments of approximately ₦258.56 billion against parent-bank shareholders’ equity of about ₦2.223 trillion, producing an indicative ratio of 11.63 percent.
That ratio is a screening indicator, not proof of a regulatory breach. The applicable regulatory calculation may use different qualifying investment values and a different definition of shareholders’ funds. UBA’s precise position must be established from the relevant regulatory returns and disclosures.
Its decision not to pay a final dividend for FY2025 was attributed by management to costs and provisioning associated with exiting regulatory forbearance. That explanation does not establish that the bank faces the same foreign-investment issue disclosed by Access.
The distinction matters for both the banks and their investors. A preliminary balance-sheet calculation should not be treated as equivalent to a confirmed regulatory finding, and the circumstances surrounding one institution’s dividend restriction should not automatically be applied to another.
UBA’s key challenge is to demonstrate that its international earnings are sustainable, adequately supported by capital and capable of translating into reliable shareholder distributions. Greater transparency on the profitability of individual markets, capital requirements and qualifying investments would help investors assess the quality of the franchise.
The competition extends beyond Access and UBA
The growing foreign earnings of Access and UBA do not automatically place them ahead of GTCO and Zenith Bank in the race for investor returns.
Reported figures for 2025 put foreign-subsidiary profit before tax at approximately ₦671.1 billion for UBA, ₦571.3 billion for Access, ₦375.3 billion for GTCO and ₦331.8 billion for Zenith.
These figures indicate the scale of the international earnings engines at the four groups, but subsidiary-level profit before tax is not equivalent to consolidated group profit. Differences in accounting treatment, consolidation adjustments and business composition must be considered before drawing direct conclusions about overall performance.
GTCO and Zenith retain substantial domestic franchises and established international operations. Their competitiveness must be assessed against the performance of their entire groups, including domestic profitability, credit quality, funding costs, capital strength and valuations.
A bank with a larger foreign earnings contribution may benefit from geographic diversification, but it may also carry greater integration costs, operational complexity and exposure to risks in multiple jurisdictions.
Conversely, a group with a stronger domestic earnings base may generate superior shareholder returns if it deploys capital more efficiently or maintains better control of credit losses.
The decisive measure is not simply how much profit comes from abroad, but how consistently the group generates returns relative to the capital and risks required to produce them.
For investors, this means comparing recurring earnings, returns on equity, impairment charges, capital adequacy and dividend capacity rather than relying on foreign earnings percentages alone.
From expansion to execution
The next phase of international banking is likely to be determined less by how many markets Nigerian lenders enter than by how effectively they manage the businesses they already own.
For Access, that means integrating acquisitions, improving operational efficiency and addressing its disclosed regulatory exposure while preserving the value of profitable subsidiaries.
For UBA, it means sustaining a large international earnings contribution, demonstrating sound capital allocation and providing clarity on the factors affecting future shareholder distributions.
For both groups, the quality of local underwriting, the strength of risk controls and the ability to manage funding across jurisdictions will determine whether geographic diversification produces durable resilience.
The implications extend beyond the individual banks. Well-managed international franchises can strengthen Nigeria’s role in regional trade finance, payments and cross-border investment, while supporting the emergence of African banking groups capable of competing beyond their home markets.
But international scale is not an end in itself. If the capital tied up in overseas businesses fails to generate adequate risk-adjusted returns, a wider geographic footprint may add complexity without delivering commensurate value.
That is why the changing earnings profile of Nigerian banks matters to the wider economy as well as to investors. The quality of capital allocation at the country’s largest lenders influences how effectively financial resources are deployed, how resilient institutions remain through economic cycles and how much capacity they retain to finance businesses at home and across the continent.
The contest is entering a more demanding phase: international expansion has created opportunities, but the ability to integrate, regulate and profitably manage those operations will determine which banks can sustain their advantage.
For Nigeria’s banking giants, the next measure of success will not be how far their franchises extend beyond the country’s borders, but how much durable value those franchises generate for shareholders and the financial system.
