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Three of Nigeria’s largest banking groups — United Bank for Africa (UBA), Access Holdings and First HoldCo, face a fresh

Three of Nigeria’s largest banking groups — United Bank for Africa (UBA), Access Holdings and First HoldCo, face a fresh test of their ability to resume dividend payments in 2026 after regulatory restrictions and a sharp increase in loan-loss provisions deprived shareholders of final payouts for 2025.

The outlook is improving, but a return to regular dividends is not yet assured. UBA’s management expects the bank to pay dividends this year; Access Holdings says the regulatory constraint that prevented its payout has been resolved, while First HoldCo has approved a policy to distribute at least 60 percent of annual profit to shareholders, subject to regulatory approval.

However, none of these developments, on the information currently available, confirms that the Central Bank of Nigeria (CBN) has cleared the three banks to resume payments.

The distinction is important for investors after the CBN’s June 2025 directive required banks with unresolved loan-forbearance exposures to suspend dividends, defer executive bonuses and halt new offshore investments until they had made adequate provisions and complied with single-obligor limits.

The directive followed years of pandemic-era relief that allowed banks to restructure troubled loans without immediately classifying them as impaired. When the regulatory concessions expired, lenders faced pressure to recognise losses that had accumulated over several years.

For shareholders, the resulting clean-up created an unusual divergence between profitability and dividend payments. While five Nigerian banks paid a combined N917.9 billion in final dividends for the 2025 financial year in 2026, UBA, Access Holdings and First HoldCo paid none, despite remaining profitable.

The question now is whether the three banks have done enough to satisfy regulators and restore payouts, or whether investors must wait longer for cash returns.

UBA and Access Holdings, meanwhile, have yet to release their half-year accounts, leaving investors waiting for a clearer picture of their latest financial performance.

UBA’s board approved its audited H1 accounts in August, but publication remained subject to CBN approval. Access Holdings also secured additional time from the Nigerian Exchange (NGX), disclosing on October 2 that it was still awaiting the requisite regulatory clearance. BusinessDay in this report analysed the banks’ 2025 and first half financial statements.

UBA: Profit pressure makes recovery less certain

UBA faces the most immediate earnings challenge among the three lenders, making its expected dividend resumption dependent on both regulatory clearance and an improvement in its underlying financial performance.

The bank’s pre-tax profit fell 47.3 percent to N423.4 billion in 2025 after recognising a N331 billion loan-loss provision and a N278 billion fair-value loss on derivatives.

It proposed no final dividend for the year, leaving shareholders with a total dividend of just N0.25 per share, down from N5.00 in 2024. The reduction represented a 95 percent decline from the previous year’s payout, which had exceeded N170 billion.

UBA management attributed the restriction to provisions that pushed its non-performing loan ratio above the threshold required for dividend payments.

This suggests that the bank’s ability to resume payouts will depend on more than a return to profitability. It must demonstrate that its impaired-loan position and capital buffers meet the CBN’s requirements.

Management has indicated that it expects to pay dividends in 2026, but the absence of confirmed regulatory clearance means the timing remains uncertain.

The bank’s next results will therefore be important in determining whether the heavy provisioning recorded in 2025 represented the bulk of the adjustment or whether further credit costs could weigh on distributable earnings.

Access Holdings: Regulatory resolution offers a clearer path

Access Holdings appears to have a more favourable earnings backdrop, although its regulatory position still needs to be confirmed.

The group’s pre-tax profit rose 16.2 percent to N1.01 trillion in 2025, making it the first year in which it crossed the N1 trillion threshold. However, impairment charges increased 209 percent to N287.3 billion, highlighting the continuing cost of credit-risk adjustments.

Access said it recommended dividends at both half-year and full-year stages but did not obtain CBN approval because of specific regulatory requirements.

The group pointed to Section 7.1 of the CBN’s guidelines for financial holding companies, saying a private placement had resolved the constraint. That explanation suggests the restriction may have been linked to the group’s regulatory capital or holding-company structure rather than profitability alone.

If the constraint has indeed been resolved and the CBN accepts the group’s position, Access could be among the better-placed of the three banks to restore dividends. Its earnings provide a stronger base for distributions than UBA’s reduced 2025 profit, although impairment costs remain a consideration.

Access also skipped an interim dividend in 2025 for the first time in a decade, making its next payout an important test of whether the interruption was temporary or signals a more cautious distribution policy.

First HoldCo: Ambitious payout policy meets regulatory reality

First HoldCo has made the clearest commitment to a future distribution, but it also faces a substantial test in translating that promise into payments.

The group’s pre-tax profit fell 70.6 percent to N234.3 billion in 2025, while chairman Femi Otedola disclosed impairment charges of N748 billion. The group had proposed a dividend of N1 per share, but shareholders received no final payout after the regulatory restrictions intervened.

On July 28, First HoldCo approved a dividend policy targeting a distribution of at least 60 percent of annual profit, subject to regulatory approval. Its chief executive has also indicated an expectation of payment at year-end.

The potential size of the payout illustrates the stakes. Applying the policy’s 60 percent floor to the group’s reported first-half 2026 profit after tax of N526.1 billion would imply approximately N315.7 billion.

That is a substantial distribution, but the calculation is illustrative rather than a forecast of an approved payment. The policy applies to annual profit, and the eventual dividend would depend on full-year results, distributable reserves, capital requirements and regulatory clearance.

First HoldCo’s strong first-half profit provides a more encouraging earnings base than its 2025 performance. Yet the scale of its earlier impairments and the need to preserve adequate capital mean the CBN’s assessment remains central to the timing and size of any payout.

What could still go wrong

Approval is binary and in the CBN’s hands. BusinessDay analysis revealed that UBA, First Bank and Ecobank saw NPL ratios jump above 10 percent when forbearance expired in the first quarter, while Access’s was 2.5 percent, and that a new 20 percent holding-company buffer in a CBN draft adds capital pressure.

Renaissance Capital, in an earlier report, still forecasts 2028 for Access to resume. Access had also skipped an interim dividend in 2025 for the first time in a decade, so half-year payouts are a test.

The same scrutiny could reach banks that paid. Zenith’s Stage 3 loans nearly doubled in a year to N618.9 billion, 4.92 percent of loans.