Fitch Ratings has changed its outlook on nine Nigerian banks and two bank holding companies from Stable to Positive, the agency said. The institutions affected include Access Bank, Zenith Bank, First Bank of Nigeria, United Bank for Africa, Guaranty Trust Bank, Guaranty Trust Holding Company, Fidelity Bank, First City Monument Bank, Wema Bank and Bank of Industry. The long-term issuer default ratings for these lenders remain at 'B', meaning the outlook change signals potential for future improvements rather than an immediate upgrade. The decision follows Fitch's October 9 revision of Nigeria's sovereign outlook to Positive from Stable.
Fitch identified several factors supporting the banking sector's improved prospects. The naira strengthened by roughly 7 percent in the first nine months of 2026, while the Central Bank of Nigeria continued accumulating foreign exchange reserves. Inflation eased to 14.63 percent in September, creating room for further monetary policy relaxation. The rating agency forecasts Nigeria's real gross domestic product growth at 4.3 percent in 2026.
The outlook revision for First HoldCo and First Bank of Nigeria reflects their restoration of compliance with capital adequacy ratio requirements. For Bank of Industry, the improved outlook reflects Fitch's view that government capacity to support the policy bank may strengthen. Nigerian banks raised substantial capital to meet new minimum paid-in capital requirements that took effect at the end of the first quarter of 2026, providing additional risk absorption capacity.
Fitch acknowledged the sector's resilience despite regulatory pressures, particularly the Central Bank of Nigeria's 45 percent cash reserve requirement for commercial banks. However, the withdrawal of regulatory forbearance around problem loan classification resulted in higher impaired-loan ratios at the end of 2025. Sustaining the positive outlook will depend on continued macroeconomic reforms, stronger operating conditions and banks' ability to maintain adequate capital buffers while managing credit risks.