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Nigerian Banks and the Culture of Concealment: How Financial Results Are Being Cooked to Hide Losses

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In Nigeria’s banking industry, profit has become more a press release than a performance. Every results season, the same storyline plays out with record profits, rising assets, and promises of “strong fundamentals.” Yet, beneath the eye-catching headlines lies a quiet deception of a pattern of accounting charades aimed at repressing the true picture of reality and skyrocketing success.

An analysis of the 2025 half-year results from ten leading financial institutions like Zenith Bank, GTCO, UBA, First HoldCo, Access Holdings, Stanbic IBTC, Wema Bank, FCMB Group, Sterling HoldCo, and Jaiz Bank exposed a pervasive culture of concealment. What the market is celebrating as a season of extraordinary profitability is, in truth, a story of concealed losses, revalued deceptions, and selective disclosure.

Zenith Bank reported a pre-tax profit of N625.6 billion, yet its trading gains fell by N328 billion and credit impairments jumped 83 percent. GTCO, the self-proclaimed profit leader, showed N900.8 billion in pre-tax earnings, but once last year’s N523 billion one-off fair-value gain is removed, actual profit declined by 26 percent. UBA’s earnings were flattered by revaluations, while its interest expenses exploded from N328.9 billion to N560.6 billion. Its trading desk flipped from a N98 billion gain to a N10 billion loss, forcing a drastic cut in interim dividends.

First Bank HoldCo’s books told their own story that despite higher revenues, pre-tax profit fell due to a N486 billion collapse in trading income from a N432 billion gain in 2024 to a N53.7 billion loss in 2025. Impairments doubled to N185 billion as the bank exited CBN’s forbearance regime, revealing losses long deferred. Access Holdings reported N2.5 trillion in gross earnings, but its statement of comprehensive income disclosed a N62.4 billion loss to shareholders driven by N155.9 billion in forex translation losses and N74.4 billion in fair-value write-downs. Profit at the top, destruction of value at the bottom.

Stanbic IBTC’s growth was buoyed by asset sales, not sustainable income. Wema Bank’s celebrated 229 percent profit surge rested on a fragile base: interest expenses rose 34 percent, while impairment charges remained suspiciously light at just N532 million. FCMB Group’s digital-era optimism could not hide the 35 percent slump in non-interest income following the loss of revaluation gains, or the N36.2 billion impairment that followed once regulatory leniency expired. Sterling HoldCo trumpeted a 157 percent jump in profit, which looks less impressive when you realise it was achieved in the shadow of a N100 billion recapitalization. The group admits it still needs N53 billion more to meet regulatory capital. Meanwhile, its cost-to-income ratio remains a heavy 64.5 percent, and non-performing loans hover above the 5 percent prudential threshold.

Jaiz Bank, meanwhile, announced N14.45 billion in profit, but its total assets shrank by N100 billion, and its operational cash flow swung from a N428 billion inflow to a N119 billion outflow with profit on paper and erosion in practice.

Behind the curtain of impressive numbers, a silent manipulation is taking place. Creative accounting, selective disclosures, and reclassification tricks have become tools in the bankers’ art of survival.

Insiders in the banking sector admit, off the record, that “results management” has become a normalised practice. The strategy is simple as in where the true numbers would reveal losses or mounting risk, the presentation is massaged to reflect strength. Loss-making subsidiaries are quietly merged into group accounts where their poor performance is diluted. Bad loans are reclassified as “restructured assets” or shifted into special-purpose vehicles that sit conveniently off the parent bank’s main balance sheet.

The Central Bank of Nigeria (CBN) bears part of the responsibility. In recent years, its supervision appears more reactive than proactive. While the apex bank routinely sanctions banks for minor customer-service infractions, it has been slow to demand full disclosure on FX exposures, hidden losses, or aggressive revaluations. Transparency is not a threat to stability; it is its foundation. A banking system that hides its weaknesses under glossy financial statements is like a house built on borrowed sand.

The real problem facing Nigerian banking today is not liquidity or profitability; it is credibility. When numbers are manipulated, when press releases are crafted to deceive, and when regulators turn a blind eye, the trust that underpins the entire financial system begins to erode. Depositors no longer believe in transparency. Investors no longer trust the data. Even genuine success stories are viewed with suspicion.

For too long, the industry has mistaken perception for progress. Banks inflate interest income in a high-rate environment, then bury the cost of risk in footnotes. They celebrate foreign-exchange gains in one year and quietly dismiss translation losses the next. They rely on regulatory forbearance to delay recognition of bad loans, then call the resulting impairments “non-recurring.”

Dividends are weaponised to signal confidence even when retained earnings are flat. Capital raises are packaged as expansion plays when, in reality, they are patchwork efforts to maintain solvency. And nowhere in these results, not even in the glossy CEO quotes, did we find a serious discussion of declining cash generation or sustainability of earnings once interest rates normalise. None of these manoeuvres strengthens the banking system; they only postpone accountability.

The way forward begins with truth. Banks must be compelled to present their financials in full, not selective highlights crafted for headlines. The CBN must demand clearer disclosures on FX positions, loan restructuring, and the sources of non-interest income, while requesting that banks disclose core operating profit separate from one-off gains and trading income; front-load cash-flow data; publish detailed impairment breakdowns that show exposures by sector and vintage; explain capital raises transparently; and align dividends with free cash flow, not cosmetic accounting profits.

Auditors must rediscover their professional conscience and not rubber-stamp whatever management wants. Journalists and analysts must drill into the notes of the accounts, asking why interest income is rising while impairment and non-performing loans are rising too. The health of the financial system depends not on who can publish the biggest profit figure, but on who can prove that the profit is real, repeatable, and resilient.

Until then, the public is advised to read every “record result” with skepticism. Because in Nigerian banking today, what the headlines celebrate, the balance sheets quietly contradict.

If the current trend continues, the supposed “profits” of today may soon be revealed as the losses of tomorrow.

A bank’s greatest asset is not capital; it is credibility. And once that is lost, no amount of cooked numbers can restore it.

Blaise, a journalist and PR professional writes from Lagos, can be reached via: [email protected]


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Ugo Onwuaso is an ICT enthusiast. He believes technology should be used for general good. He holds a Master of Public Administration (MPA) degree from the Lagos state University. Dear Reader, Your support matters. But we believe that technology makes life more exciting and helps improve the lives of people around Nigeria and indeed the world. That is why, we have devoted our energy to independent reportage of technology and finance and how they affect lives. Our incisive and analytical view of how technology news affects the daily life help individuals and organizations make up their minds. Quality journalism costs money. Today, we're asking that you support us to do more. Kindly support our effort to deliver technology and finance journalism to everyone in the world. Donate as little as N1,000. Bank transfers can be made to: UBA Plc 1017156876 Communication Week Media Ltd

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Court Jails ‘Colonel’, ‘Major’ of Global Money-Laundering Ring

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A “colonel and a major” in a “worldwide highly sophisticated money-laundering syndicate on a breathtaking scale” have been jailed for nine years and 7 and half years respectively.

Court Jails ‘Colonel’, ‘Major’ of Global Money-Laundering Ring

Ejike Francis Ogbuefi (42) of Clonard Road, Crumlin, Dublin 12, and Steven Silvester (32) of the Paddocks, Morristown, Newbridge, Co Kildare, were both convicted of directing the activities of a criminal organisation following a trial at Dublin Circuit Criminal Court in February.

Ogbuefi was also convicted of 32 counts of money laundering and seven of conspiracy to launder money.

The jury also convicted Silvester of five counts of money laundering, two of attempted money laundering, four of conspiracy to launder money and one of using a false instrument.

Both defendants had no previous convictions here or in another jurisdiction.

The court heard that both men were assessed to be above mule herders and money mules in the operation, with Ogbuefi having a more active role.

During the sentence hearing, Judge Martin Nolan suggested to the investigating garda that the men were a “colonel and a major”, which Det Garda Steven Kelly agreed with.

Imposing sentence on Friday, the judge said both men were involved in the offending and played certain roles.

He noted that the scheme’s ambition was to “get accounts to launder illicit monies” which were “undoubtedly the product of criminal behaviour” and that third parties unknown to the court suffered as a result.

“Both men were reasonably experienced in how the banking system works” and aware of its weaknesses which they tested, sometimes successfully, the judge said.

The judge said he had considered the mitigation and there was a “good chance” the men would not reoffend in future, but that the court could not be certain.

The judge noted that money laundering is a “serious problem” and the court often dealt with cases of people who provided their bank details to be used in these schemes.

“These bank accounts are absolutely necessary for all fraud, because monies have to come to earth somewhere,“ the judge said, noting that the defendants’ main role was to procure bank accounts so that money could be sent to others who profited.

He imposed on Ogbuefi a sentence of nine years and imposed a 7½ year sentence on Silvester, whom he considered to be at a lower level.

Kelly told Seoirse Ó Dúnlaing, prosecuting, that the Garda investigation looked at various bank accounts, transactions and online communications.

Evidence suggested both men were receiving requests, often from phone numbers in Nigeria, to launder money from different types of frauds.

Kelly agreed with Conor Devally, defending Ogbuefi, that his client is from Nigeria and his family is law-abiding.

Garda Kelly agreed with Maurice Coffey, defending Silvester, that his client became involved in this criminality some time after his arrival in Ireland in 2015 and had no record of shopping in high-end stores or trappings of wealth.

It was also accepted that Ogbuefi appeared to have a more active role than Silvester.

Defence counsel told the court their clients accepted the verdicts of the jury and were remorseful.

Testimonials were handed to the court on behalf of both men.

Mr Devally asked the court to view Ogbuefi as being “appointed to a position of local authority in a wider organisation”.

Mr Coffey said Silvester was under pressure and desperate at the time.

He asked the court to consider that his client did not come to Ireland to get involved in this offending, but fell into temptation at a time of vulnerability.


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Activist Warns against Rising Junk Food Culture in Nigeria

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Nnimmo Bassey, environmental activist and food sovereignty advocate has raised concerns over the growing influence of junk food culture and global food politics on Nigeria’s food systems.

Activist Warns against Rising Junk Food Culture in Nigeria

Nnimmo Bassey, environmental activist

Bassey warned that the increasing consumption of highly processed foods poses serious risks to public health, cultural identity, and national food security.

He made these remarks on Thursday while speaking at the Sustain-Ability Academy lecture on Food, Power and the  Politics of Hunger, organised by the Health of Mother Earth Foundation in collaboration with the University of Port Harcourt.

“Food is not just for sustenance; it is central to our identity, our relationships, and our traditions,” he said.

He explained that traditional diets reflect the diversity of Nigeria’s ethnic groups and have historically fostered unity within communities.

Bassey traced the evolution of food systems in Nigeria, highlighting how colonialism, commerce, and conflict have reshaped local diets.

He referenced the Nigerian Civil War as a turning point when food was weaponized, leading to widespread malnutrition and long-term dietary changes, particularly in the Eastern region.

The activist criticized the rapid rise of fast food consumption, describing it as a product of modern society’s demand for instant gratification.

According to him, fast food outlets use sensory stimulation, bright lighting, loud music, and constant visual entertainment to distract consumers from questioning the nutritional value of what they eat.

“People leave with more than just a full stomach, they carry heavy metals, artificial colourings, and harmful substances in their bodies,” he said.

Bassey also expressed alarm over the increasing presence of genetically modified organisms (GMOs) in Nigeria’s food system.

He argued that such products, often introduced without sufficient scrutiny, could have long-term health and environmental consequences.

He further cautioned against the role of political leaders in normalizing unhealthy consumption patterns.

“When top politicians publicly consume junk food and sugary drinks, they send a dangerous message that such habits are acceptable or even desirable,” he said.

At the heart of his argument is what he described as “food colonialism” a system driven by global power dynamics, where economic pressures, debt, and cultural influence shape local food choices to benefit multinational corporations at the expense of local farmers.

Bassey called for a “decolonization” of food systems across Africa, urging governments and citizens to prioritize indigenous foods, protect seed-sharing traditions, and resist policies that undermine local agricultural practices.

He also challenged prevailing narratives around hunger, questioning whether food insecurity is truly a result of low productivity.

“In countries like Nigeria, nearly half of all food produced goes to waste. The issue is not just production, but distribution, policy, and power,” he explained.

The session concluded with a call for urgent reforms to ensure fairness, resilience, and sustainability in food systems, with a focus on supporting smallholder farmers and addressing the structural causes of hunger.


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Gartner Forecasts Surge in AI-powered Public Services

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At least 80% of governments will deploy artificial intelligence (AI) agents to automate routine decision-making, enhancing efficiency and service delivery by 2028.

This is according to market research firm Gartner, which highlights a growing shift toward digital governance, where AI-powered systems will increasingly handle repetitive administrative tasks, such as processing applications, managing public records and responding to citizen queries.

“Government chief information officers are under growing pressure to embed AI into decision-making capabilities rapidly and responsibly,” says Daniel Nieto, senior director analyst at Gartner. “The rise of multimodal AI, alongside conversational and agentic systems, has expanded what public organisations can automate, understand and anticipate.”

The Gartner report comes as South Africa is moving to embed AI into public administration, with early use cases emerging across service delivery, disaster response and internal operations, even as full-scale deployment of autonomous “AI agents” remains some years away.

The country’s National AI Policy Framework, released in 2024, has set the direction for adoption, with a comprehensive national policy expected by 2027.

Implementation is likely to follow from 2027 onwards, positioning the country for a more structured and regulated rollout of advanced AI systems across departments.

While South Africa has yet to deploy AI agents at scale, government and research initiatives indicate that agent-like systems are already taking shape.

Global use cases

Globally, governments are rapidly deploying AI agents to automate public services and internal operations, shifting from simple chatbots to systems that can execute tasks and coordinate workflows.

In the US, federal and city agencies are using AI agents to handle citizen queries, draft documents and manage call centres, while in China, autonomous systems are being integrated into administrative processes and urban management.

European governments are piloting AI-driven tools in policing and public service delivery, and in emerging markets, agentic platforms are being used to improve disaster response, financial inclusion and digital identity systems.

However, Gartner notes that fragmentation is one of the most persistent barriers to AI value in government.

According to a Gartner survey of 138 respondents from government organisations worldwide between July and September 2025, 41% of respondents cited siloed strategies and 31% cited legacy systems as key challenges to adopting and implementing digital solutions.

“Technology modernisation alone has not resolved these issues,” says Nieto.

The market analyst firm says as AI transitions from experimentation to being deeply embedded in decision-making, governance approaches must also evolve. It points out that traditionally, AI governance has centred on managing models, data and algorithms.

However, it states that decision intelligence (DI) shifts this focus towards the governance of decisions themselves; for example, on how they are designed, executed, monitored and audited. This shift in governance is especially critical in government, where public legitimacy relies on transparency and fairness, the firm explains.

Measurable impact

The Gartner survey found that 39% of respondents cited improved service and citizen satisfaction as primary reasons to invest in building citizen trust.

The firm notes that DI offers a structural foundation for operationalising this trust by making decision pathways explicit and auditable.

“By governing decisions, rather than just isolated AI components, governments can better balance automation with human judgement, particularly in high-stakes or rights-impacting contexts,” says Nieto. “Regulated industries and governments cannot rely on opaque ‘black box’ systems for consequential decisions. DI elevates explainability from a technical requirement to a governance imperative.”

Because of the need for transparency in decision-making, Gartner predicts that by 2029, 70% of government agencies will require explainable AI (XAI) and human-in-the-loop (HITL) mechanisms for all automated decisions that impact citizen service delivery.

Gartner explains that XAI and HITL designs are foundational to public-sector DI. These mechanisms ensure decision logic can be inspected, explained and challenged. Because of XAI and HITL, humans also retain authority over exceptions, appeals and high-risk cases, and accountability is preserved even as automation increases, it adds.

While efficiency remains important, Gartner says citizen trust in government’s ability to provide effective services is becoming a key driver of digital transformation. Fifty percent of government respondents cited improved citizen experience as one of their top three priorities.

“As AI and decision intelligence increasingly automate and streamline service delivery, the traditional notion of ‘citizen experience’ evolves,” says Nieto.

“When citizens receive what they need from the government automatically, direct interactions may decrease, making trust in the system’s reliability, fairness and transparency even more critical. Because trust is so imperative in these situations, the predictive capacity to anticipate potential needs could reshape how government digital services are delivered.”

 


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