Nigerian banks spent nearly ₦378 billion on levies to the Asset Management Corporation of Nigeria (AMCON) and the Nigeria Deposit Insurance Corporation (NDIC) in the first quarter of 2025, stoking concerns over profitability and investor returns.
Data from unaudited results filed on the Nigerian Exchange (NGX) show lenders incurred ₦377.85 billion in regulatory charges between January and March, a 34.6 per cent jump from ₦280.67 billion in the same period last year.
AMCON levies alone accounted for ₦283.85 billion, up 28.3 per cent year-on-year, while deposit insurance premiums surged by 58 per cent to ₦93.99 billion.
The analysis covered 10 leading banks, including First Bank Holdings, Zenith, GTCO, UBA, Access, Fidelity, Wema, Stanbic IBTC, Sterling, and FCMB. Collectively, they posted pre-tax profits of ₦1.58 trillion—only a marginal 0.36 per cent rise from ₦1.51 trillion in Q1 2024.
Analysts warn the growing burden of AMCON levies is squeezing banks’ return on equity by as much as 150 basis points, reducing funds available for lending to businesses, SMEs, and mortgages. Shareholders have also voiced frustration, arguing that rising charges erode distributable profits and dividends.
“Banks are being penalised for sins they did not commit. Well-managed lenders that avoided reckless lending in the 2000s are still paying for the mistakes of others,” a shareholder group leader told Nigerian Tribune.
AMCON was created in 2010 as a crisis-resolution vehicle to mop up bad loans after the global financial crisis. Initially planned as a 10-year intervention, the corporation remains active 15 years on, largely funded through annual bank levies that some insiders say approached ₦847 billion in 2023—more than double official figures.
Experts, including Tilewa Adebajo of CFG Advisory, argue that the lack of clarity on AMCON’s future is distorting the financial system. “If AMCON must remain, a fundamental review of its laws is required. Otherwise, it should be wound down and integrated into a reformed NDIC structure,” Adebajo said.
Lawmakers, however, caution against an abrupt exit, citing over ₦4 trillion in unresolved debts. House Committee Chairman on Banking, Hon. Eze Nwachukwu Eze, recently stressed that any exit strategy must be carefully designed to avoid systemic risks.
For now, banks continue to absorb mounting costs, even as calls grow louder for the federal government to decide whether AMCON should be reformed, phased out, or made a permanent fixture of Nigeria’s financial landscape.
