FirstHoldCo Plc has reported a strong recovery in profitability for the first quarter of 2026, following a steep earnings decline in its 2025 full-year results caused by substantial impairment charges linked to delinquent loans in the oil and gas sector. The banking group posted a profit before tax of N321.1 billion for the quarter ended March 31, 2026, representing a 72.2 percent increase from N186.5 billion recorded in the same period of 2025.
Profit after tax rose by 56.5 percent to N267.8 billion, while gross earnings climbed by 26.8 percent to N942 billion. This robust quarterly performance comes months after the group's 2025 audited results revealed a significant erosion in profitability despite growth in core earnings. Profit before tax for the 2025 financial year fell by 70.5 percent to N235 billion from N796.5 billion in 2024, while profit after tax declined by 79.4 percent to N139.5 billion.
Impairment Charges Drive 2025 Profit Decline
The sharp decline in 2025 profitability was largely driven by a 93.8 percent increase in impairment charges, which rose to N826.3 billion from N426.3 billion in the previous year. This was compounded by the moderation of foreign exchange gains recorded in earlier periods. Despite the pressure on bottom-line performance, the group maintained strong revenue growth during the year. Gross earnings rose by 6.9 percent to N3.4 trillion, supported by a 24.9 percent increase in interest income to N2.99 trillion and a 36.8 percent growth in net interest income to N1.92 trillion.
However, non-interest income fell sharply by 50 percent to N377.4 billion, while operating expenses increased by 32.1 percent to N1.23 trillion amid inflationary pressures, rising personnel costs, and higher regulatory and administrative expenses. The bank's cost-to-income ratio worsened to 53.8 percent from 43.3 percent in 2024. Asset quality also weakened during the year as the non-performing loan (NPL) ratio rose to 12 percent from 10.2 percent in 2024, reflecting stress exposures in the oil and gas sector. Nonetheless, the group significantly improved its NPL coverage ratio to 98.7 percent from 54.8 percent, indicating stronger provisioning against troubled assets.
Q1 2026 Recovery and Balance Sheet Clean-Up
In the first quarter of 2026, the bank sustained its clean-up exercise while returning to stronger profitability. Impairment charges rose marginally by 8.3 percent to N40.4 billion, while non-interest income more than doubled to N219.2 billion, helping operating income rise by 40.2 percent to N658 billion. The bank's loan book expanded by 5.3 percent to N9.44 trillion in Q1 2026, although customer deposits declined by 2.7 percent to N18.38 trillion from the 2025 year-end position. Total assets also slipped slightly by 1.4 percent to N26.88 trillion. Non-performing loans rose further to 13.4 percent in Q1 2026, while NPL coverage moderated to 89.4 percent from 98.7 percent at the end of 2025.
Commenting on the results, Group Managing Director Wale Oyedeji said the bank's first-quarter performance reflected the resilience of its franchise and the benefits of measures taken in 2025 to de-risk the balance sheet. He noted that the group had made notable progress in recoveries from delinquent borrowers, especially in the oil and gas segment, disclosing that about N19 billion was recovered in the first quarter of 2026. According to him, the group remains focused on strengthening earnings quality, improving operational efficiency, enhancing governance standards, and sustaining prudent risk management.
Capital Raising and Segment Performance
FirstHoldCo also said it continued to strengthen its capital base in line with the Central Bank of Nigeria's new minimum capital requirements for banks. The group disclosed that it had raised N128.7 billion so far under its N350 billion capital raising programme aimed at meeting the N500 billion regulatory threshold for FirstBank. The commercial banking segment remained the major contributor to earnings, generating N897.1 billion in gross earnings in Q1 2026, up 23.8 percent year-on-year, while profit before tax rose by 71 percent to N285.8 billion. Meanwhile, its Investment Banking and Asset Management business recorded a 36.9 percent increase in gross earnings to N22.9 billion, although profit before tax declined by 7.3 percent to N14.8 billion.
