Nigeria’s banking sector has become the subject of fierce online debate following new data showing the massive gap between the market capitalisation of Nigerian lenders and their South African counterparts.

As of May 2025, the combined valuation of banks listed on the Nigerian Exchange (NGX) stood at N10.5 trillion — less than $8 billion.

In contrast, South Africa’s six largest banks are valued at more than $70 billion, with Standard Bank alone worth $21.8 billion.

The disparity—described by many as “staggering”—resurfaced after British-Nigerian investor Dr Ola Brown noted that Nigerian banks collectively remain valued below $8 billion, compared to nearly $100 billion for South Africa’s top six.

Although a Nigerian Tribune review places the figure slightly higher at $9.6 billion for Nigeria’s 10 biggest banks, the gap remains enormous.

Analysts say the valuation gulf reflects Nigeria’s unstable FX environment, thin liquidity, inflationary pressures and lingering policy uncertainty. Others contend that despite these challenges, Nigerian banks remain profitable, well-regulated and capable of commanding higher valuations once the macroeconomic climate improves.

One X user argued: “The $8 billion vs $100 billion gap isn’t a competence issue. It’s a macro issue. With FX stability and consistent policy, Nigerian banks can unlock far higher valuations.”

But critics insist the problems run deeper. Another user wrote: “Please, what we do in Nigeria is not banking… Almost zero retail products, ridiculous loan terms, and no real support for startups.”

Nigeria’s Top 10 Banks by Market Capitalisation (as of Sept. 19, 2025) are:

GTCO – N3.42 trillion ($2.28 billion): Nigeria’s most valuable bank; P/B ratio of 1.10; recently raised N209 billion to recapitalise GTBank.

Zenith Bank – N2.64 trillion ($1.76 billion): Despite an eight per cent profit dip in H1 2025, remains strong; raised N350 billion to boost IT and growth.

UBA – N1.8 trillion ($1.2 billion): One of four Nigerian banks with valuation above $1 billion.

Stanbic IBTC – N1.55 trillion ($1.03 billion): Trades at a premium P/B of 1.70; 2024 profit up 43.7 per cent.

Access Holdings – N1.38 trillion ($920 million): A major financial services group with a strong African footprint.

FirstHoldCo – N1.33 trillion ($886 million): Enjoying renewed investor confidence under Femi Otedola.

Fidelity Bank – N1.042 trillion ($694 million): 2024 PBT surged 210 per cent; targets N500 billion profit in 2025.

Wema Bank – N440bn ($293 million): Share price up 239 per cent in one year.

FCMB Group – N423.7 billion ($282 million): Revenue up 41.3 per cent despite higher impairment losses.

Sterling Financial Holdings – N385.6 billion ($257 million): Stable but modest growth.

Across X, many Nigerians argue that the valuation gap is less about bank performance and more about Nigeria’s broader economic structure. One user wrote: “Nigerian capital simply is not mobile… The money government injects doesn’t circulate.”

Others pointed to narrow product offerings, low trust, FX turbulence and costly recapitalisation cycles. “If you have N1 billion to save, it’s rarely Nigeria you think of first,” another user added.

Some also referenced historical constraints, including pre-BVN/NIN identity challenges that limited credit growth and pushed liquidity into real estate.

Despite the divergent views, a common theme is emerging: Nigeria’s banks are fundamentally strong and profitable, but macroeconomic instability continues to suppress valuations. Until liquidity deepens, FX becomes predictable and investor confidence rebounds, analysts say Nigerian bank market caps will remain far below those of South Africa’s financial giants.

Copyright © 2022 Nigerian Tribune Provided by SyndiGate Media Inc. (Syndigate.info).