Banks Are Raising Billions – So Why Are They Still Paying Dividends?
In 2025, Nigerian banks are walking a financial tightrope and somehow smiling for the cameras.
They’re under CBN pressure to raise fresh capital to meet new regulatory thresholds, yet they’re still dishing out billions in dividends, almost like its business as usual.
So, the real question is:
Why are banks raising capital with one hand and giving it away with the other?
Let’s break down what’s happening based on reported data and explore what this financial double-act means for investors, regulators, and everyone watching from the sidelines.
Capital In vs. Cash Out What the Reports Show
The figures below are based on publicly available disclosures and financial news reports. Exact values may vary.
|
Bank |
Capital Raised (Est.) |
Dividends Paid (Est.) |
Comment |
|
GTCO |
₦209bn |
₦269bn |
Raised big, paid big |
|
Zenith Bank |
₦350bn |
₦195bn |
Classic high-yield play |
|
UBA |
Ongoing |
₦170bn |
Paid big |
|
Fidelity Bank |
₦176bn |
₦89bn |
Pay-out despite recap drive |
|
Access Holdings |
₦351bn |
₦125bn |
Paid big |
Combined Estimate: Over ₦1.08 trillion raised, with ₦848+ billion returned to shareholders all in the same fiscal window.
What’s Really Going On?
- The CBN Said “Recapitalize or Step Aside”
Banks are scrambling to meet new capital requirements from the Central Bank of Nigeria. Some are issuing new shares. Others are pursuing private placements or rights issues.
This isn’t optional. It’s a survival tactic.
- Dividend Payouts Are About Confidence, Not Cash
Nigerian banks know that nothing excites shareholders quite like the words:
“Your dividend has been credited.”
It signals strength, continuity, and investor respect especially at a time when market confidence is fragile.
No dividend? Stock price tanks.
Big dividend? Investors stay loyal.
- But Is This Sustainable?
That’s the billion-naira question.
Paying out hefty dividends while simultaneously raising fresh equity can dilute value over time. It also sends a mixed message:
Are you capital-weak or cash-rich?
Some analysts call it “fiscal gymnastics” raising money in public to fund private payouts. In the short term, it keeps everyone calm. But long-term? It could widen cracks in already fragile balance sheets.
Financial Juggernut Insight
Nigerian banks aren’t broke but they’re being stretched.
They want to keep shareholders happy, meet regulatory demands, and maintain market respect. But serving all three masters at once is a high-wire act.
If you’re a retail investor:
- Know that recapitalization may dilute your shareholding
- Understand that today’s dividend doesn’t guarantee tomorrow’s
- Look past the payout alerts and watch the balance sheet
It’s not about what they paid it’s about what they’ll have left.