Fidelity Bank Plc has opened 2025 with a powerful earnings statement, reporting a pre-tax profit of N107.77 billion for the first quarter, a 167.79% year-on-year leap – signaling that its recent strategic moves, including a successful capital raise, are already delivering returns to investors.

The performance, announced in the bank’s unaudited financial statement for the quarter ended March 31, 2025, confirms a continuation of the bank’s growth trajectory, with earnings underpinned by a sharp increase in interest income, disciplined cost management, and improved asset quality.

The result also bolsters investor sentiment following last year’s oversubscribed public offers and rights issue, which Fidelity Bank launched as part of its plan to meet the Central Bank of Nigeria’s (CBN) N500 billion minimum capital requirement for tier-one banks. The recapitalization directive, issued in March 2024, gave banks a 24-month window to bolster their capital base to improve financial system stability.

Fidelity Bank’s combined capital raise via public offer and rights issue, which closed in late 2024 — drew massive interest from investors, who were betting on the bank’s profitability and management’s strategy. This Q1 result now serves as proof that those bets are beginning to pay off. Fidelity Bank raised a total of N231.97 billion through its public offer. The offer received applications for 23.79 billion shares valued at N231.97 billion. The bank initially aimed to raise N97.5 billion through the public offer, with a total capital raise of N127.1 billion including a rights issue.

Core Earnings Drive Profit Surge

Gross earnings rose to N315.42 billion in Q1 2025, a 64.21% increase from the N192.1 billion recorded in the same period last year. The bulk of this came from interest income, which surged 65.44% year-on-year to N281.47 billion. Notably, 75% of interest income came from loans and advances to customers, affirming the bank’s aggressive but disciplined lending stance. Investment in securities added another 18.31% to interest income.

At the same time, interest expenses rose to N90.65 billion, a 28.58% increase, largely due to rising deposit rates. However, this accounted for just 32% of total interest income, a marked improvement from 41.14% in Q1 2024, meaning Fidelity is now retaining a greater share of its income.

Net interest income jumped 91.52% to N190.82 billion, while net interest income after credit loss provisions grew 111.45% to N184.53 billion. The bank’s cost of risk fell significantly, with credit loss expenses dropping by nearly half to N6.28 billion, down from N12.37 billion a year earlier — indicating fewer bad loans and improved loan book quality.

Non-Interest Income and Fee Growth

Fidelity Bank also made significant headway in its non-lending business. Fees and commission income rose 30.10% year-on-year to N23.82 billion. While income from account maintenance fees slightly declined, the bank saw a 57% jump in earnings from traveler’s cheques and foreign bills and a 23.38% increase in commissions from letters of credit. Fee and commission expenses, however, rose by 37.56% to N2.67 billion.

Ultimately, net profit for the period rose to N91.10 billion, up from N31.44 billion in Q1 2024 — a growth of 189.75%. This translated to earnings per share of N1.81, representing an 84.69% improvement from N0.98 recorded a year earlier.

Balance Sheet Expansion and Liquidity Strength

Fidelity Bank’s balance sheet continues to expand at pace. Total assets climbed to N10.45 trillion, representing an 18.48% growth from the same quarter in 2024. The bank also recorded a sharp increase in cash and cash equivalents, which jumped by 128.90% to N1.62 trillion — a key indicator of the bank’s healthy liquidity position.

Loans and advances to customers rose 4.96% to N4.61 trillion, underlining controlled lending growth despite aggressive interest income expansion. Customer deposits also grew by 11.15% to N6.60 trillion, reflecting sustained depositor confidence and strong mobilization of retail and institutional funds.

Shareholders’ funds rose slightly by 3.39% to N933.14 billion, boosted by retained earnings and capital injection from the recently concluded public offers.

A Payout for Investor Faith

With its Q1 profit now standing at over N107 billion, roughly 75% of its full-year 2024 pre-tax earnings of N140 billion, Fidelity has effectively rewarded investor confidence just months after their commitment. The performance suggests the bank is on track to deliver another record-breaking year.

The Q1 earnings also improve the bank’s capacity to retain profits for future capital buffers while maintaining dividend potential — a key attraction for retail shareholders.

On the Nigerian Exchange (NGX), Fidelity Bank began the year trading at N17.50 per share. As of the close of Q1 2025, the stock had gained 14%, making it the 48th best-performing stock on the exchange in year-to-date rankings. This upward movement mirrors growing investor optimism, especially as the broader banking sector enters a period of transformation under the CBN’s capital restructuring directive.

Analysts say Fidelity Bank’s result strengthens its positioning to become one of the strongest indigenous players in the tier-one banking space. Its ability to mobilize deposits, grow interest income, maintain cost discipline, and manage risk effectively, while also attracting market capital, puts it in a favorable spot as Nigerian banks adjust to tougher regulatory and economic conditions.

The African Development Bank (AfDB) has unveiled a new five-year Country Strategy Paper (CSP) for Nigeria, pledging to provide around $650 million annually from 2025 to 2030 — a move that could inject a total of $3.25 billion into Africa’s fourth-largest economy over five years.

The initiative forms part of the Bank’s broader effort to scale up development financing across Africa, after years of lamenting the region’s chronic underfunding and underperformance in critical sectors.

Under the first phase of the strategy, Nigeria is set to receive $2.95 billion in AfDB financing between 2025 and 2029, complemented by an additional $3.21 billion in co-financing from development partners. The Bank says the strategy seeks to unlock inclusive growth, create millions of jobs, and support the country’s ambition to double the size of its economy to $1 trillion.

But the plan, though ambitious in scope, is already generating anxiety over the likelihood of the funds being squandered — especially in a country long plagued by corruption, lack of transparency, and poor implementation of past international interventions.

AfDB’s Bigger Push Across Africa

The development financing drive in Nigeria is part of AfDB’s broader shift to address what it has repeatedly described as “Africa’s chronic development financing gap.” The continent, according to the Bank’s leadership, needs between $68–$108 billion annually just to bridge its infrastructure deficit, yet struggles to mobilize even a fraction of that due to global funding imbalances, investor hesitation, and weak domestic capacity.

AfDB President Akinwumi Adesina has in several public addresses decried the low share of global development finance that comes into Africa, pointing out that African countries, despite being the most vulnerable to climate shocks and infrastructure shortfalls, receive less than 5% of global climate financing.

In response, the Bank is increasing its commitments, establishing funding mechanisms, attracting partners, and ramping up its country-specific strategies. Nigeria, being its largest shareholder and the continent’s most populous nation, is now a key focus of this recalibrated approach.

Yet, while AfDB is scaling up its lending, there is an equally significant challenge on the receiving end — how to ensure that funds are not diverted or wasted.

Nigeria’s History of Missed Opportunities

Nigeria’s infrastructure and social development deficits are well-documented. From power outages that cripple industries to dilapidated roads and a water system that excludes millions, the country has struggled for decades to turn financial aid and loans into tangible improvements. And the problem has rarely been the lack of money, but how it’s managed or mismanaged.

The corruption risks surrounding Nigeria’s institutions remain a deep concern. The country consistently ranks low on Transparency International’s Corruption Perceptions Index, and there have been repeated cases of funds meant for roads, hospitals, education, and power being embezzled or misused. Several state and federal agencies have been implicated in the misappropriation of donor funds in the past, leading to disillusionment among international partners.

This new wave of AfDB funding, while promising, has not yet been accompanied by any enforceable safeguards to guarantee accountability. There is currently no clear mechanism outlined in the strategy to monitor how funds will be deployed.

Development analysts have raised red flags over this.

Aside from the concerns, the strategy itself is one of the most ambitious in recent memory. It focuses on two priority areas:

1. Promoting sustainable, climate-smart infrastructure to improve industrial competitiveness — including roads, power, and water systems;
2. Driving inclusive green growth by supporting agro-industrialization and job creation for youth and women.

Nigeria’s infrastructure gap is estimated at $2.3 trillion between 2020 and 2043, and the Bank believes targeted investments in renewable energy, clean transport systems, and resilient agricultural infrastructure could significantly lower business costs and unlock new economic zones.

AfDB projects that the strategy could generate 1.56 million jobs, mostly through agribusiness expansion, youth-focused training schemes, and the scaling up of support for women-led enterprises. The Bank’s Affirmative Finance Action for Women in Africa (AFAWA) programme will be deployed in Nigeria to provide tailored financial access to female entrepreneurs — a move long overdue given their disproportionate exclusion from credit markets.

The plan is also aligned with Nigeria’s own development blueprint — including Agenda 2050, the National Development Plan 2021–2025, and the Tinubu administration’s Renewed Hope Agenda.

AfDB said the strategy would also support Nigeria’s ability to take advantage of the African Continental Free Trade Area (AfCFTA) by boosting energy access, upgrading logistics networks, and connecting farmers and businesses to larger markets.

Rural Focus, But No Guarantees

Millions of Nigerians, particularly in rural communities, small towns, and marginalized groups — are expected to benefit from improved services and economic opportunities if the strategy is implemented faithfully. However, this remains a big “if”.

The absence of a rigorous auditing system, transparent tracking, and public engagement mechanisms may erode the potential impact. It is believed that in the current Nigerian context, where even state-level budgets are rarely published and procurement is often opaque, the AfDB’s assumption of effective implementation is overly optimistic.

However, Abdul Kamara, Director General of the AfDB’s Nigeria Office, expressed confidence in the transformative potential of the plan.

“By investing in sustainable infrastructure and inclusive agricultural growth, we are not only building roads, power systems, and transforming agriculture – we are building pathways to prosperity for millions of Nigerians,” Kamara said.

Still, for many Nigerians, the announcement is bittersweet — hopeful on the surface, but laced with the familiar fear that another windfall may end up benefiting only a few at the top.