South Africa’s Absa Group is considering turning its Nigerian representative office into a merchant bank, potentially giving the lender a much larger foothold in Africa’s biggest economy. The proposal is part of Absa’s broader push to diversify beyond its core markets of South Africa, Ghana and Kenya.
Absa CEO Kenny Fihla said the group is exploring the Nigerian opportunity alongside potential expansion into other African markets. The move would put Absa in more direct competition with established regional banking groups already operating in Nigeria.
The timing is significant. Absa reported R12.8 billion in H1 2026 headline earnings, up 8% year-on-year, while revenue increased 4% to R58.8 billion. Its credit-impairment charges also declined, supporting the group’s stronger first-half performance.
For Nigeria’s financial sector, a merchant-banking operation could increase competition for corporate, investment-banking and capital-markets business. For investors, the bigger question is whether Absa ultimately secures the necessary Nigerian regulatory approvals and converts its representative presence into an operating business.
