…Aradel remains bright spot with record profit, N23 final dividend
Nigeria’s equities market opened the new week on a bullish note, rebounding from last week’s sharp losses as bargain hunting in banking stocks lifted the Nigerian Exchange, NGX, All-Share Index, ASI, by 0.96 per cent.
The rebound followed one of the market’s toughest weeks in 2026, when a draft regulatory proposal by the Central Bank of Nigeria, CBN, triggered a steep sell-off in banking stocks, wiping trillions of naira off market value and dragging the broader market lower.
At the close of trading on Monday, the ASI gained 2,261.84 basis points to settle at 238,203.11, while market capitalisation rose by N1.51 trillion, or 1.00 per cent, to close at N152.83 trillion.
The market recovery came despite negative breadth, with 17 gainers against 35 losers, indicating that renewed buying interest in medium and large-cap stocks, particularly in the banking sector, helped reverse part of last week’s decline.
The latest improvement followed a bruising performance last week, when the ASI closed at 235,941 points, down 3.59 per cent week-on-week, while market capitalisation fell to N150.9 trillion from N156.97 trillion. Even with that correction, the market remained strongly positive year-to-date.
Analysts had attributed the steep decline largely to the financial services sector, which shed 9.36 per cent last week after the CBN released two exposure drafts on June 11 — the Revised Guidelines for Financial Holding Companies and the Guidelines on Ring-Fencing of Closely Linked Entities.
The most consequential provision in the draft requires holding companies to maintain regulatory capital at least 20 per cent above the combined capital of their subsidiaries, with only paid-in capital recognised for that purpose. Retained earnings would no longer count, effectively placing several tier-one banking groups below the required threshold.
Industry estimates put the total capital shortfall at about N370 billion, with Access Holdings seen requiring roughly N120 billion, GTCO N103.7 billion, First HoldCo N90 billion and Stanbic IBTC N11.8 billion.
The market’s initial reaction was swift. Last week, GTCO fell 15.01 per cent, First HoldCo declined 20.29 per cent, Zenith Bank dropped 11.65 per cent, UBA lost 8.14 per cent, while Access Holdings shed 7.69 per cent.
However, Monday’s session suggested that investors may be beginning to reassess the severity of the sell-off. Banking stocks led the recovery, with the banking index advancing 4.64 per cent. First HoldCo and GTCO gained the maximum 10.00 per cent each, while Zenith Bank rose 7.09 per cent. The industrial goods sector also edged higher by 0.04 per cent.
The bullish outing was further supported by increased market activity. Total volume traded rose by 8.05 per cent, while total value traded surged by 47.86 per cent. About 475.82 million shares valued at N36.49 billion were exchanged in 63,567 deals.
By volume, Fidelity Bank led activity with 10.02 per cent of total trades, followed by UBA with 8.81 per cent, Access Holdings 8.10 per cent, Zenith Bank 6.17 per cent and Sterling Financial Holdings 5.97 per cent. By value, MTN Nigeria accounted for 45.38 per cent of total turnover, emerging as the most valuable stock traded on the day.
Market watchers said the latest rebound reflected bargain hunting after last week’s panic-driven sell-off, even as concerns remain over the long-term implications of the CBN draft for banking groups.
Beyond the capital requirement, the draft rules also propose a significant restructuring of banking groups. Foreign subsidiaries would have to sit directly under holding companies rather than under Nigerian banks, parent HoldCos would be barred from participating in lending and credit decisions of subsidiaries, and each subsidiary would require at least 51 per cent ownership by the HoldCo.
The proposals could also compel banks such as Zenith and UBA, which currently operate as standalone banks, to consider transitioning into non-operating holding company structures.
Still, analysts cautioned that the draft rules remain open for stakeholder comments until July 9, 2026, and may yet be moderated. They argued that while the short-term pressure on capital remains a concern, stronger capital bases and cleaner group structures could ultimately improve transparency, resilience and long-term investor appeal in the banking sector.
Amid the turbulence, Aradel Holdings remains one of the market’s strongest bright spots.
The company posted a record profit after tax of N757.3 billion for the 2025 financial year, its strongest annual result since listing on the NGX. It also proposed a total dividend of N33 per share for the year, comprising a N10 interim dividend already paid and a final dividend of N23 per share, subject to shareholder approval at its annual general meeting.
The performance underscored Aradel’s growing appeal as a cash-generative, shareholder-focused company at a time when financial stocks are facing regulatory uncertainty.
Analysts also noted that Aradel’s dividend policy, calibrated against dollar profitability and cash flow rather than naira-denominated earnings alone, makes it especially attractive in an environment where currency weakness can erode the real value of investor returns.
Meanwhile, the NGX also recently amended its Rule 15.29.2.C.2, effectively changing the way stock prices move on the exchange.
Under the revised structure, the minimum volume required to move a stock’s published price will now depend on the stock’s price band. Stocks priced at N1,000 and above will require 10,000 units to move price, those between N500 and N999.99 will require 50,000 units, while stocks below N500 will continue to require 100,000 units.
The change is expected to improve price integrity and reduce distortions, particularly for high-value stocks, by ensuring that published prices reflect more meaningful trading activity.
On Monday’s gainers’ chart, First HoldCo and GTCO led with 10.00 per cent gains each, followed by International Energy Insurance with 9.88 per cent, McNichols with 9.56 per cent and Zenith Bank with 7.09 per cent.
On the losers’ chart, Zichis topped the list with a 10.00 per cent decline, followed by Consolidated Hallmark Holdings, which lost 9.94 per cent, Eterna 9.90 per cent, Deap Capital 9.82 per cent, Austin Laz 9.74 per cent and Abbey Mortgage Bank 9.41 per cent.
A notable development within the financial sector remains the acquisition of 1,021,334,544 ordinary shares of 50 kobo each in First HoldCo through private placement, which also contributed to the mixed performance between the ASI and market capitalisation. The additional listing helped lift overall market capitalisation even as market breadth remained weak.
Overall, the market narrative has shifted from panic selling to cautious bargain hunting.
Analysts said last week’s banking rout did not necessarily reflect a collapse in banking fundamentals, but rather the market’s instinctive reaction to regulatory uncertainty. Monday’s rebound, especially in bank counters, suggests investors are beginning to distinguish between temporary policy shocks and long-term value.
For investors, the key near-term questions remain how far the CBN softens the draft after the consultation process, how quickly banks can respond to possible capital requirements, and whether fundamentally strong counters such as Aradel and MTN Nigeria can continue to attract capital as the market reprices risk.
Although sentiment has been bruised, the latest rebound indicates that investor confidence has not been broken, with the market still showing resilience despite regulatory pressure and sector-specific volatility.