FirstRand Limited, Africa’s most valuable bank by market capitalisation, is exploring expansion opportunities in Nigeria and Ghana as it seeks to deepen its footprint across the continent and boost its contribution to group earnings beyond its South African home market.

The Johannesburg-based lender is assessing opportunities in the two West African economies as part of a broader strategy to become a top-three bank in selected African markets. The move follows a strong first-half performance, with normalised earnings jumping 11% to R23.2 billion ($1.4 billion) in the six months through December.

“From a macroeconomic point of view, Ghana and Nigeria are actually going through a much better period than they’ve had in the past because of the structural reforms they embarked upon, so we are looking very constructively at growing in those markets,” CEO Mary Vilakazi said in an interview with Bloomberg last week.

FirstRand’s interest in Nigeria and Ghana comes at a time when both economies are showing signs of macroeconomic stabilisation following years of currency volatility, high inflation, and fiscal pressure.

Nigeria has undertaken significant reforms, including naira devaluation, fuel subsidy removal, and power sector restructuring, while Ghana recently emerged from a debt restructuring process and has begun stabilising its exchange rate and inflation trajectory.

For FirstRand, the timing reflects a strategic bet that the worst of the macroeconomic turbulence in these markets may be behind them, creating an entry window for well-capitalised foreign institutions willing to commit long-term capital and operational resources.

The bank already has a presence in both countries. First National Bank Ghana operates as a full commercial bank, while RMB Nigeria functions as a corporate and investment banking unit. However, FirstRand remains relatively small in both markets and is now exploring how to scale operations to achieve top-three positioning.

FirstRand’s West African ambitions are part of a broader pan-African expansion strategy that has accelerated over the past two years. The bank is also exploring ways to scale its operations in Zambia, where it holds the number one banking position following the acquisition of Standard Chartered’s wealth and retail banking business in the country last year.

“It’s actually one of the standout performers” in the second half of 2025, Vilakazi said of the Zambian operation. “The ability to get further load and scale in that business is the kind of thing that we would like to see more of.”

The bank is also monitoring developments in Kenya, where authorities have announced plans to increase minimum capital requirements for banks tenfold by 2029, a move expected to trigger consolidation in East Africa’s largest banking market.

“We’re still watching that consolidation activity in Kenya, and we are always in discussions to see whether a good entry opportunity offers itself for the group,” Vilakazi said.

Despite its continental ambitions, South Africa will remain FirstRand’s primary market. The country accounted for 81 per cent of group earnings in the six months to December.

However, the bank expects South Africa’s economic growth to remain modest at around 1.8% annually over the next three years, potentially accelerating to about 3% within five years if reforms in the energy, infrastructure, transport, and logistics sectors gain traction.

“It is possible to structurally lift our GDP growth rate, but it will require a lot more effort for us to get to that 3 to 5% growth,” Vilakazi said.

The tepid domestic growth outlook reinforces FirstRand’s strategic imperative to diversify its earnings base geographically, positioning the rest of Africa as a critical growth engine for the next decade.

FirstRand’s expansion plans are being funded by robust operating performance. Non-interest revenue climbed 12% in the first half, driven by sustained momentum in the insurance business, a significant rebound in the global markets unit, and further private equity realisations.

Net interest income grew 7.7%, supported by improving advances growth in the lending books in South Africa, across broader Africa, and in the UK.

The group declared an interim dividend of R2.59 per share, signalling confidence in its capital position despite setting aside R5.8 billion to cover a legal dispute in the UK related to an industry-wide vehicle finance mis-selling scandal.

FirstRand’s West African push comes as several African banking giants accelerate expansion across the continent, filling gaps left by international lenders scaling back operations.

Absa Group recently acquired Standard Chartered’s wealth and retail banking operations in Uganda, while Nigerian lenders, including Access Holdings and Zenith Bank, are expanding into East African markets such as Kenya and Ethiopia.

For FirstRand, the question is whether it can replicate the scale, efficiency, and profitability it has achieved in South Africa and Zambia in more complex, competitive, and volatile markets like Nigeria and Ghana, and whether the macroeconomic reforms Vilakazi is banking on will prove durable enough to support long-term returns.

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