Access Holdings Records N474bn Profit As Rising Costs undermine Earnings Efficiency

By Kingsley Ani

Access Holdings Plc reported N474.2 billion profit after tax for the nine months ended 30 September 2026, representing 5.9 percent increase from the corresponding 2025 period. Its unaudited financial results, disclosed on Thursday, showed profit before tax rising 8.3 percent to N667.4 billion. However, operating expenses increased 11.8 percent to N1.3 trillion, while total operating income declined 3.2 percent to N2.06 trillion. Management is pursuing Scale-to-Value strategy to improve operating efficiency, earnings quality and shareholder returns, alongside regulatory capital restructuring across six banking subsidiaries.

DECISION HIGHLIGHT

• Profit after tax: N474.2bn, up 5.9 percent.
• Profit before tax: N667.4bn, up 8.3 percent.
• Impairment charges: Down 73.5 percent to N92.9bn.
• Customer deposits: N36.9trn, up 6.6 percent.
• Loans and advances: N14.3trn, up 7.4 percent.
• Total assets: N52.6trn.
• Operating expenses: N1.3trn, up 11.8 percent.
• International operations: 82.2 percent of banking profit before tax.

DECISION MEMO

Access Holdings’ nine-month results reveal a banking group generating higher profits despite mounting operating-cost pressures. The 5.9 percent growth in profit after tax is positive, but the composition of earnings deserves closer scrutiny.

The 73.5 percent reduction in impairment charges to N92.9 billion significantly strengthened earnings quality, lifting net interest income after impairment by 32.1 percent to N1.2 trillion. Fee and commission income also increased 8.4 percent to N650.9 billion, reinforcing the contribution of non-interest revenue.

However, the 11.8 percent increase in operating expenses, against a 3.2 percent decline in total operating income, exposes an efficiency challenge. Profitability is improving, but the cost of sustaining the group’s extensive operations remains substantial.

Management’s Scale-to-Value strategy therefore represents more than a change in corporate language. It acknowledges that the returns from previous expansion must now justify the capital, infrastructure and operating expenditure committed to building the group.

Management stated: “The scale-to-value roadmap represents a transition from rapid expansion to improving the quality, cost discipline, and productivity of our established infrastructure to maximise shareholder returns.”

International diversification provides another important earnings dimension. Operations outside Nigeria contributed 82.2 percent of banking profit before tax, demonstrating the growing importance of the group’s African and international subsidiaries.

Equally significant is the ongoing capital recall from six banking subsidiaries to bring Access Bank’s investment-in-subsidiaries ratio within the statutory 10 percent threshold under Section 19(8)(c) of the Banks and Other Financial Institutions Act.

Management noted: “The capital recall process across our banking subsidiaries is progressing steadily, which upon completion will align our structure with statutory thresholds and remove historical constraints on dividend distributions.”

The restructuring could improve dividend-distribution capacity, although actual payments remain subject to regulatory requirements, capital adequacy, reserves and board approval.

DATA BOX

Geographical banking profit distribution: International subsidiaries, 43.7 percent; Rest of Africa, 38.5 percent; Nigeria, 17.8 percent.

WHO WINS / WHO LOSES

• Potential winners: Shareholders, international banking subsidiaries and investors in transaction banking, payments and trade finance.
• Potential losers: Businesses exposed to higher banking charges or tighter credit-risk controls.
• Regulatory beneficiaries: Banking stakeholders if capital restructuring improves compliance and financial transparency.

POLICY SIGNALS

The capital recall process demonstrates the importance of aligning banking-group structures with statutory investment limits. Regulatory compliance must accompany stronger capital allocation, risk governance and operational efficiency.

INVESTOR SIGNAL

Access Holdings offers evidence of earnings resilience, international diversification and improving credit-risk performance. However, sustainable shareholder value will depend on controlling operating costs, maintaining asset quality and converting international scale into distributable returns.

RISK RADAR

The principal risks are rising operating expenses, weaker total operating income, foreign-market exposure, regulatory restructuring delays and the possibility that lower impairment charges may not be sustained. The critical test of the Scale-to-Value strategy is whether operating efficiency improves sufficiently to support stronger and more sustainable shareholder returns.

Kingsley Ani is a journalist who has over the years been covering capital markets, corporate results, economic and public-interest developments with a focus on clear, factual reporting.