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Nigerian banking stocks have experienced a significant surge since January 7, driven by several major lenders raising over ₦1 trillion ($662 million) from the stock market to meet new capital requirements.
The NGX Banking Index, which tracks banking stocks, rose by 12.24 percent as of market close on Friday, February 14, 2025, according to data compiled by TechCabal.
GTCO’s share price closed at ₦63.45 on Friday, reflecting a 12.90 percent increase since January 7, while Zenith Bank’s shares closed at ₦51.60, up 4.03 percent since it announced its capital raise.
This rally comes amid renewed investor confidence in Nigeria’s economy, which has been bolstered by currency reforms and other measures aimed at stabilizing Africa’s largest economy.
Despite global market volatility, Nigeria has seen an influx of foreign investment, with its sovereign risk spread dropping to its lowest level since January 2020, according to Bloomberg.
This marked a recovery from the economic strains of the pandemic.
In March 2024, the Central Bank of Nigeria (CBN) raised the minimum capital threshold for banks by tenfold, excluding retained earnings from qualifying capital.
This move prompted major lenders to tap the stock market for additional funding to meet the new requirements before the 2026 deadline.
GTCO, a banking group with a market capitalization of ₦1.85 trillion, raised ₦209 billion in the first phase of its recapitalization.
Zenith Bank secured ₦350.4 billion through a rights issue and public offer on January 27.
Together, these two banks have raised over ₦559.4 billion, with other financial institutions also contributing, bringing the total capital raised above ₦1 trillion.
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