Absa Group Considers Nigerian Merchant Bank Venture

In a significant development for the Nigerian financial sector, South Africa’s third-largest lender by assets, Absa Group, is exploring converting its representative office in Nigeria to a merchant bank. This move would allow Absa to offer a broader range of services including corporate deposits, loans, investment banking, and project finance.

Current Presence & Proposed Expansion

Absa already operates in Nigeria through various subsidiaries focusing on trade finance, investment banking, and market products. The conversion to a merchant bank would mark a substantial expansion of its operations in the country.

Strategic Implications

This move positions Absa to compete more directly with established Nigerian banks like Access Holdings, Zenith Bank, and First Bank, as well as other South African rivals such as Standard Bank and FirstRand. Nigeria’s banking sector has seen considerable growth recently, reaching a market capitalization of ₦10.5 trillion ($7.7 billion) in 2025.

Absa Group CEO Kenny Fihla noted that this expansion aligns with the company’s strategy to tap into high-growth corporate and financial markets across Africa. With operations already established in multiple African countries, Absa serves over 13.4 million customers and generated R58.79 billion ($3.61 billion) in total income for the first half of 2026.

The company’s focus on Nigeria follows a pattern where South Africa, Kenya, and Ghana have historically contributed to over 80% of Absa’s profits.