Afrinvest predicts 21.95% GDP growth, N1,500/$ for $1tr economy

.Banks raised N2.5tr new capital in H1 2025

Nigeria’s rebased Gross Domestic Product (GDP) needs 21.95 per cent growth at N1,500 per dollar exchange rate to achieve $1 trillion economy target by 2031, Afrinvest West Africa Limited, an investment and research firm has predicted.

The prediction is contained in its 20th Nigeria Banking Sector Report 2025 titled: ‘ACT-BOLD: Beyond a Trillion Dollar Economy’ presented at an event marking its 30 years of operations, in Lagos.

According to the investment and research firm, at rebased GDP nominal size of N372.8 trillion, Nigeria requires a minimum yearly growth rate of 21.9 per cent to attain $1 trillion economy valuation by 2031.

According to the Afrinvest’s report, an exchange rate of N1,500/$1 or a much stronger exchange rate at a slower growth rate was predicted to be required to attain the GDP size milestone.

The report indicated that despite the President Bola Tinubu administration’s confidence that the banking industry will support the $1 trillion economy target realisation, there was a need to address longstanding impediments that constrain broad-based growth potential. Without such intermediation, it added, banks would only deliver, at best, uneven and subpar growth across a few services-based sectors, while the overall economy continues to grow at a slow pace.

The report unveiling, which attracted many financial sector stakeholders and market leaders, also highlighted the role of monetary policy tightening in achieving subdued inflation rate figures, restoring market confidence and stabilising the forex rate.

The report also noted that monetary policy under the Olayemi Cardoso-led Central Bank of Nigeria (CBN) showed successive hikes in the benchmark rate by a cumulative of 875 basis points to 27.5 per cent between February 2024 and November 2024, and this, alongside other variables, was left unchanged throughout the first half of this year.

It showed that the ongoing recapitalisation of the banking industry had shown that several banks initiated or completed a capital raise to strengthen their buffer.

“As of mid-2025, our estimate suggests that banks have collectively raised over N2.5tn through rights issues, public offerings and private placements,” it noted.

Also, at least four lenders – Access Corporation, Zenith Bank, Ecobank and Lotus Bank – reportedly met the new capital thresholds, while several others are on track to meet the June 2026 deadline.

“A few institutions are exploring merger and acquisition options as a compliance strategy. Overall, the growth of the banking sector (proxied by financial institution GDP) has remained resilient, clearing at 15 per cent in real terms in the first quarter of 2025 and ranking among the top 10 contributors to the GDP in the period,” the report said.

Speaking during the unveiling, the Group Managing Director, Afrinvest West Africa Limited, Dr Ike Chioke, described the company’s 30 years of operations as a journey of resilience, innovation, and leadership meant to shape Nigeria’s financial markets. He said the 30-year journey unfolded against a backdrop of shifting global and domestic political, macroeconomic and capital markets realities.

“From the return to democracy in 1999, to the dot-com bust of 2000 to 2002, Nigeria’s banking reforms between 2004 and 2005, the global financial crisis of 2007 to 2009, the oil price crash of 2014 to 2016 and, more recently, the COVID-19 shock of 2020, as well as the global inflation surge of 2021 to 2023, each era tested resilience but also opened new opportunities.

“Afrinvest has grown through these cycles, always adapting, always innovating,” Chioke stated.

He said the Banking Sector Report, first published in 2006, remained a trusted compass for policymakers, investors and financial institutions navigating the changes in Nigeria’s economy.

According to him, each of the past 20 editions provides clarity in moments of uncertainty and ambition in times of reform. He described the 20th edition as both a call to action and a framework for Nigeria’s growth.

The Chairman, Afrinvest West Africa Limited, Donald Lawson, who was represented by Professor of Economics, University of Nigeria, Nsukka and Co-Chair, Nigerian Economic Summit Group (NESG) National Advisory Council, Osita Ogbu, said that great institutions were not accidents of history but products of vision, courage and the ability to adapt to changing times.

Lawson said the 30 years of Afrinvest were not simply the story of a financial institution but a reflection of a story of vision, leadership, resilience and an unwavering commitment to excellence in institution building.

“It is also a moment of gratitude for the people who built this institution brick by brick. Afrinvest is a testimonial to hard work, discipline, character and fortitude. It is a classic Nigerian story of never-say-die!

“Our story began in 1995, when Godwin Obaseki founded Securities Transaction and Trust Company Limited, known as SecTrust, here in Lagos. In the same year, Phillip Iheanacho established Afrinvest Limited in London. In the turbulent climate of the mid-1990s, it took extraordinary courage to launch professional stockbroking firms. Yet Godwin, Phillip and their colleagues dared to do so, building two separate firms defined by professionalism and integrity,” Lawson added.

From a single Lagos office, Afrinvest now operates across five major Nigerian cities: Lagos, Port Harcourt, Abuja, Onitsha and Kano.

“Over the years, we have not only built markets, evidenced by landmark transactions within and beyond Nigeria’s borders; we have built innovative platforms and investment instruments that continue to redefine access to opportunities for our clients,” he added.