First Holdco Plc recorded a sharp earnings contraction in its 2025 financial year as profit after tax plunged by more than 93 percent, reflecting the impact of deteriorating asset quality and elevated loan impairment charges following the withdrawal of regulatory forbearance by the Central Bank of Nigeria (CBN).
According to the group’s unaudited financial results, net profit for the year fell to N44.982 billion, compared with N677.005 billion recorded in the previous financial year. The steep decline was largely driven by a surge in expected credit loss provisions as the financial holding company took corrective steps to fully exit the CBN’s forbearance regime.
The non-operating holding company of First Bank of Nigeria significantly increased impairment charges on its loan book as part of a broader balance sheet clean-up exercise. Expected credit loss provisions jumped by 75 percent year on year to N748.125 billion in 2025, up from N426.296 billion in 2024, marking the most material drag on earnings performance during the period.
This spike in provisions followed increased credit migration into Stage 3 loans, further weakening asset quality metrics and pushing the impairment-to-loan ratio higher across the group’s portfolio. A portion of the impaired assets was written off entirely, with N27 million classified as bad debt during the year.
Despite the heavy provisioning, First Holdco reported growth in core interest income. Net interest income rose to N1.910 trillion in 2025, representing a 10 percent increase from N1.401 trillion recorded in the prior year, supported by higher interest-earning assets and improved pricing.
However, after accounting for impairment charges on expected credit losses, net interest income fell sharply to N1.162 trillion, highlighting the scale of pressure exerted by weak asset quality.
Non-interest income offered partial support, with net fee and commission income increasing by 19 percent to N290.735 billion, compared with N244.889 billion in 2024. Growth was driven by higher transaction volumes and expanded digital banking activity across the group’s operating subsidiaries.
Foreign exchange performance also improved markedly in 2025, as First Holdco reversed losses recorded in the prior year. FX revaluation losses declined by 83 percent to N16.816 billion from N101.44 billion in 2024, while FX trading gains rose by 49 percent to N54.459 billion from N36.494 billion.
As a result, the group posted a net foreign exchange gain of N37.643 billion, compared with a loss of N64.945 billion in the corresponding period of the previous year.
Nonetheless, operating profitability weakened significantly. Operating profit declined by 71 percent to N228.37 billion in 2025, down from N795.932 billion in 2024, reflecting the combined effect of higher provisioning costs and a challenging operating environment.
Profit before tax followed a similar trajectory, falling to N229.097 billion, a sharp drop from N796.467 billion posted in the prior year.
Despite strategic initiatives and ongoing efforts to strengthen balance sheet resilience, the scale of impairment charges linked to the CBN forbearance exit dominated performance, culminating in net income of N44.982 billion for the year—one of the steepest earnings declines in the group’s recent history.
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