Banks Seek New Revenue Channels As FX Gains Fade

Nigeria’s banking sector is moving into a new earnings phase as the once-lucrative foreign-exchange revaluation gains from the 2023–24 naira devaluations roll off. In those years, banks booked record profits as the weaker currency boosted the value of their foreign-currency assets. With the naira relatively more stable and a retroactive windfall tax now targeting those FX gains, that one-off profit engine is slowing sharply.

This shift is already visible in results. Analysts point to profit declines at some of the largest lenders and a broad moderation in earnings growth as trading and revaluation income normalise. A recent review of nine-month numbers showed big banks facing double-digit drops in profit as FX windfalls vanished, while research houses now talk about the sector “transitioning into a normalised earnings environment” rather than another year of super-charged returns.

Data already show strong year-on-year growth in fees.

In response, banks are leaning harder into non-interest income: transaction fees, payments and collections, value-added digital services, asset-management and custody, and more sophisticated advisory offerings. Data already show strong year-on-year growth in fee and commission lines for several institutions, partially offsetting weaker FX trading income and supporting top-line resilience. The strategic logic is clear: fee-based and digital revenues are recurring, scalable, and less exposed to the volatility of monetary and FX policy.

For customers, the pivot will likely mean richer digital ecosystems—more apps, embedded finance propositions, and platform partnerships—but also closer scrutiny of pricing as banks optimise fee structures to protect margins. Regulators, meanwhile, will be watching whether the new model delivers genuine financial deepening—more credit to the real economy and better service—rather than simply reshuffling income streams. For investors, the key question is which institutions can turn this post-FX-windfall moment into a durable, diversified revenue story rather than a step-down in returns.

Sources

• Nairametrics (2025). “As FX-driven windfalls fade, Nigeria’s banks are pivoting…”

• The Punch (2025). “Banks seek new revenue channels as FX gains fade.” 

• Ranks Africa (2025). “Nigerian Banks Pivot: The Shift to Sustainable Non-Interest Income.”