The Nigerian banking sector is positioned for continued outperformance through 2026.
With the Central Bank of Nigeria’s (CBN) recapitalisation deadline of March 2026 now in the rearview mirror, analysts highlight a “Winner’s List” of bolstered institutions ready to capitalise on a high-yield environment and increased lending capacity.
Key drivers for the sector’s robust outlook include the completion of major capital raises, a steepening yield curve following the MPR’s peak at 27.5 percent, and a pivot toward non-interest income.
While some dilution occurred during the 2024-2025 rights issues, the resulting fortress balance sheets are expected to drive higher dividend payouts in the 2026 fiscal year.
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Nigeria’s biggest banks have largely cleared the recapitalisation hurdle months ahead of the March 31, 2026 deadline, deploying a mix of speed, scale and strategy to meet the Central Bank of Nigeria’s (CBN) stricter capital thresholds.
According to an analyst at Cordros, the Banking sector (2026 earnings per share growth is estimated at +19.1 percent year-on-year) is set for an earnings uplift, underpinned by enhanced capital buffers and a healthier credit cycle.
Also, analysts at Afrininvest stated that the banking sector is one of the winners in some of the pre-election periods, supported by the expectation of strong earnings and investor preference for liquid, systemically important tickers.
They also expects the sector to deliver over 32 percent by year’s end based on strong interest income, improved asset yields, and balance sheet expansion following recapitalisation efforts.
UBA, Access, GTB, Zenith, and Stanbic IBTC banks are selected Stocks in the Afrinvest Banking Value, while listed banks above, alongside Fidelity and FCMB, made its high dividend yield indices.
Based on current market data and analyst recommendations, here are the top Nigerian bank stocks to watch:
Access Holdings (ACCESSCORP)
Access Corp is highlighted as a primary beneficiary of the new capital regime. Having successfully navigated its N500 billion requirement early, the bank is now focused on its Pan-African scale-up strategy.
CardinalStone projects a 12-month target price of 101.4 percent, a potential percentage increase in a stock’s price, and a dividend yield of 11.4 percent by the end of 2026.
Analysts view ACCESSCORP as the most undervalued Tier-1 player relative to its asset base. Its expansion into pension and fintech subsidiaries provides a diversified revenue stream.
Zenith Bank (ZENITHBANK)
Zenith Bank remains a “favored pick” for income-focused portfolios. Known for its best-in-class efficiency, the bank enters 2026 with significantly higher liquidity buffers.
For CardinalStone, it sees a potential percentage increase in a stock’s price of 58.3 percent by the end of the year and a dividend Yield of 9.5 percent.
Zenith is expected to maintain its status as the dividend king. With the recapitalization pressure lifted, the bank is projected to return a larger share of its retained earnings to shareholders, supported by a 25 percent growth in interest income.
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United Bank for Africa (UBA)
UBA is cited as a “top selection” for investors seeking geographical diversification. Its operations across 20 African countries act as a natural hedge, providing high-quality FX earnings.
CardinalStone said that Investors can look forward to a 48.6 percent upside potential over the next 12 months alongside a 7.9 percent dividend yield.
Following its successful rights issue, UBA’s capital adequacy ratio is among the highest in the sector. Investors are particularly optimistic about its digital banking growth, which now accounts for a significant portion of its fee-based income.
Guaranty Trust Holding Company (GTCO)
GTCO continues to be viewed positively as regulatory burdens ease and the bank’s “Habari” ecosystem gains traction.
With a 9.3 percent dividend yield and a projected 41.8 percent price increase over the next year, this represents a strong total return opportunity as projected by CardinalStone.
This was also Cordos ‘ analyst’s top pick for 2026 in the banking sector, with a target price of N115.19 per share.
We expect a re-rating in 2026 year-end due to sustained return on equity outperformance over cost of equity, healthy net interest income, and continued leadership in cost management.
“ Our positive outlook on GTCO stems from the group’s superior earnings
quality, a clean loan book, which is expected to support credit creation and
bolster core earnings, sustained leadership in cost management, and
undeniable balance sheet strength, which supports balance sheet expansion,” an equity analyst at Cordros said.
Despite high competition, GTCO maintains the industry’s lowest cost-to-income ratio. Analysts believe the bank’s lean operational model will allow it to deliver superior Return on Equity (ROE) compared to peers in a post-recapitalization market.
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Fidelity Bank (FIDELITYBK)
Fidelity Bank is a standout among the former Tier-2 lenders, having successfully used the recapitalization window to join the Tier-1 conversation.
The stock offers a significant 12-month price target upside of 31.5 percent, complemented by a robust 7.9 percent dividend yield
Management’s focus on specialty commercial verticals and SME lending has paid off. The bank’s recent capital injection is expected to fuel a 15-20 percent growth in its loan book through 2026.
