Shareholders of Fidelity Bank Plc are excited with the Banks growth performance as the it recorded 37.9 per cent growth in gross earnings to N434.95 billion in first quarter 2026 as the international commercial bank continued to expand its core banking market share.

Interim report and accounts of Fidelity Bank for the three months ended March 31, 2026 released at the Nigerian Exchange (NGX) showed that gross earnings rose from N315.42 billion in first quarter 20025 to N434.95 billion in first quarter 2026, representing an increase of 37.9 per cent.

The performance was driven by impressive growth in the bank’s core business operations with interest incomes rising by 22.8 per cent to N314.48 billion in first quarter 2026 as against N256.10 billion in first quarter 2025.

With net interest income at N180.97 billion, the bank closed the period with profit before tax of N92.48 billion. After taxes, net profit stood at N74.47 billion for the three-month period. Earnings per share remained high at N5.69, underlining the capacity of the bank to reward its shareholders.

The balance sheet of the bank also emerged stronger. Total assets crossed the N11 trillion mark to N11.35 trillion by March 2026 compared with N10.46 trillion recorded in December 2025. Customers’ deposits increased from N6.89 trillion to N7.38 trillion. Total equity rode on the back of earnings growth to a 27.5 per cent increase from N1.09 trillion in December 2025 to N1.39 trillion by March 2026.

The first quarter 2026 results further consolidated the strong earnings outlook of the bank, which had successfully completed its recapitalisation amidst impressive earnings performance in 2025.

Fidelity Bank had recorded double-digit growths in interest and non-interest incomes as well as key balance sheet items during the year ended December 31, 2025.

The audited report showed that gross earnings rose from N1.04 trillion in 2024 to N1.52 trillion in 2025, an increase of 45.6 per cent. Interest and similar incomes had grown by 38.7 per cent from N803.1 billion in 2024 to N1.11 trillion in 2025. Fees and commission incomes also rose by 44.7 per cent from N78.4 billion to N113.4 billion. The bank recorded net profit after tax of N242.4 billion in 2025.

The bank’s balance sheet emerged stronger with total assets rising by 18.6 per cent to N10.46 trillion in 2025 as against N8.82 trillion in 2024. Customer deposits increased by 16.1 per cent from N5.94 trillion to N6.89 trillion, reflecting continued franchise strength and an improved funding profile. Net loans and advances meanwhile declined by 2.4 per cent to N4.28 trillion in 2025 as against N4.39 trillion in 2024, attributable to customers paying down on their mature obligations.

The bank had in 2025 strengthened its capital position, with eligible capital rising to N561 billion, above the regulatory minimum of N500 billion for banks with international authorisation. In addition, capital adequacy had remained robust, with Capital Adequacy Ratio of 30.94 per cent by December 2025 as against 23.47 per cent by December 2024.

Managing Director, Fidelity Bank Plc, Dr. Nneka Onyeali-Ikpe, said the first quarter 2026 results reinforced the bank’s strong and resilient business model.

She noted that with the remarkable success of its recapitalisation programme and continuing expansion, Fidelity Bank has entered a new era of growth and impressive returns.

“We are on a stronger footing and confident that we will set new growth records that are reflective of our legacy and the future we are working on,” Onyeali-Ikpe said.

Oil prices rebounded on Tuesday after the United States carried out what it described as defensive strikes in southern Iran, raising fresh concerns over the fragile ceasefire and ongoing peace talks between Washington and Tehran.

The strikes came amid expectations that both countries were nearing an agreement to end the three-month war and reopen the Strait of Hormuz for the free movement of oil shipments.

From about $97 per barrel on Monday, global benchmark Brent crude futures rose by roughly 3.5 per cent on Tuesday to around $100 per barrel.

According to reports, US forces struck missile-launch sites and other targets in southern Iran on Monday, even as the Donald Trump administration signalled that a peace agreement between the two sides could be close.

In a statement, the US Central Command said the attacks were defensive in nature. “US forces conducted self-defense strikes in southern Iran today to protect our troops from threats posed by Iranian forces. Targets included missile launch sites and Iranian boats attempting to emplace mines,” CENTCOM spokesman Capt. Tim Hawkins said.

Reacting, Iran accused the United States of violating the ceasefire with the strikes. Iran’s Foreign Ministry said the attacks in the southern Hormozgan province, where Iranian media reported explosions early on Tuesday, amounted to a “gross violation” of the fragile ceasefire that has been in place for nearly seven weeks, according to Reuters.

Both sides had earlier indicated progress on a memorandum of understanding that could halt the war and restore shipping activities through the Strait of Hormuz, while giving negotiators 60 days to address more contentious issues, including Iran’s nuclear programme.

Reports also indicated that Iranian negotiators had pushed for the proposed agreement to include the release of billions of dollars in frozen assets during talks held in Qatar.

The war, which began with US and Israeli strikes on Iran on February 28, has triggered a major oil supply shock, increasing the costs of fuel, fertiliser, and food globally. Iran had responded to the attacks by launching drones and missiles at Gulf states hosting US military bases.

Traffic through the Strait of Hormuz, which accounts for about one-fifth of global oil and liquefied natural gas trade, has remained significantly below normal levels since the conflict began.

Although diplomatic efforts are continuing, there are growing fears that the latest US strikes could further escalate tensions in the Middle East and disrupt global energy supplies.

No fewer than 89 firms listed on the Nigerian Exchange remitted a combined N579.78bn as company income tax in the first quarter of 2026, representing a 10.60 per cent increase from the N524.23bn paid in the corresponding period of 2025.

An analysis of the companies’ unaudited financial statements by The PUNCH showed that out of 143 companies listed on the main board of the NGX, about 89 firms recorded tax payments during the period under review, while 54 firms either reported zero tax obligations, delayed filings, or did not publish tax figures on the Exchange’s disclosure segment.

Across 11 business categories, companies under the Information and Communications Technology sector emerged as the biggest contributor to government tax receipts after paying N191.22bn in Q1 2026, up by 175.8 per cent from N69.32bn in Q1 2025. The N190.92bn tax charge recorded by MTN Nigeria Communications Plc resulted in the sharp increase.

The Industrial Goods sector followed with N151.31bn in taxes, rising by 18.9 per cent from N127.29bn, while oil and gas companies paid N177.61bn, though this represented a decline of 36.9 per cent from N281.25bn in the corresponding period of 2025 due largely to lower tax charges by Seplat Energy Plc.

Consumer goods firms remitted N62.69bn, representing a 73.8 per cent increase from N36.07bn, while financial services companies paid N56.69bn, up by 27.7 per cent from N44.38bn.

At the lower end of the spectrum, natural resources firms paid only N121.43m in taxes, down by 4.2 per cent year-on-year, while construction and real estate firms remitted N107.36m, representing a 51.8 per cent decline.

Sector leaders

Collectively, the top 10 corporate taxpayers in Q1 2026 were led by MTN Nigeria Communications Plc with N190.92bn from the ICT sector, followed by Seplat Energy Plc with N176.60bn from oil and gas.

Others were Dangote Cement Plc (N100.07bn), Guaranty Trust Holding Company Plc (N84.76bn), Ecobank Transnational Incorporated (N73.46bn), First HoldCo Plc (N53.26bn), Lafarge Africa Plc (N51.17bn), Stanbic IBTC Holdings Plc (N50.44bn), Access Holdings Plc (N49.07bn), and Zenith Bank Plc (N46.90bn).

Veritas Kapital Assurance Plc recorded the strongest year-on-year tax increase with a 746.6 per cent jump, followed by Sterling Financial Holdings Company Plc with 338.9 per cent, First HoldCo Plc with 179.1 per cent, AXA Mansard Insurance Plc with a 168.6 per cent swing in tax burden, and Presco Plc with 81.2 per cent growth.

On the other hand, firms with the sharpest tax declines included Eterna Plc with a 63.9 per cent drop, C & I Leasing Plc with 40.6 per cent, Consolidated Hallmark Holdings Plc with 35.1 per cent, Trans-Nationwide Express Plc with 33.5 per cent, and Red Star Express Plc with 28.7 per cent.

Among the biggest nominal taxpayers, MTN Nigeria, Seplat, Dangote Cement, GTCO, and Ecobank remained the five highest contributors overall, while firms such as Trans-Nationwide Express Plc, Premier Paints Plc, Tripple Gee and Company Plc, Juli Plc, and John Holt Plc recorded some of the smallest tax obligations during the period.

Analysts speak

In separate interviews with The PUNCH, market and investment analysts explained that profitability played a role in the effective tax rates of major firms and evaluated the role of the new tax laws, predicting their future impact on the finances of these firms.

Managing Director of Afrinvest Consulting, Abiodun Keripe, said the divergence in tax payments reflected profitability trends, sector-specific pressures, and tax incentives.

“The divergence in tax payments among these companies is largely tied to profitability patterns, sector-specific pressures, and the impact of tax incentives or deferred tax adjustments,” Keripe noted. “Companies such as Dangote Sugar Refinery Plc, Presco Plc, and Nestlé Nigeria Plc recorded stronger year-on-year tax expenses mainly because their earnings improved significantly during the period under review. In most cases, higher profitability naturally translates into higher income tax obligations for companies.”

The Afrinvest boss explained that stronger performers benefited from improved pricing power, exchange-rate gains, rising consumer demand, and better cost management.

This trend was evident in companies such as Dangote Sugar Refinery Plc, which increased its tax expense by 51.5 per cent to N1.54bn after returning from a N22.63bn pre-tax loss in Q1 2025 to a N20.69bn pre-tax profit in Q1 2026.

The company’s gross profit surged to N43.10bn from N9.26bn after the cost of sales declined sharply. Similarly, Presco Plc raised its tax payment by 81.2 per cent to N19.99bn after revenue rose to N100.86bn and finance income climbed sharply to N5.13bn.

Nestlé Nigeria Plc also recorded a 65.8 per cent increase in tax expense to N34.77bn as revenue expanded to N326.13bn and net finance costs narrowed substantially.

The ICT sector posted the strongest growth overall. Airtel Africa’s tax charge rose by 94.3 per cent year-on-year, while MTN Nigeria alone accounted for over 99 per cent of the sector’s total tax contributions.

Financial institutions also posted stronger tax remittances on the back of higher earnings. GTCO doubled its tax expense to N84.76bn, while First HoldCo increased its tax payment by 179.1 per cent to N53.26bn after profit before tax rose to N321.12bn.

Stanbic IBTC’s tax burden also rose following the introduction of a minimum tax component.

Meanwhile, Managing Partner at SBM Intelligence, Ikemesit Effiong, assessed that companies with lower tax obligations were largely battling margin pressure, weak demand, or deferred tax adjustments.

Speaking on factors determining firms’ varying remittances, Effiong said, “It appears to be driven by a mix of operational recovery, strategic cost management, and acute macroeconomic pressure. Companies that posted higher tax bills did so because their underlying profitability improved, largely through one-off gains or deep cost restructuring.”

He added, “Those with lower tax bills are generally experiencing margin compression, structural demand weakness, or aggressive tax planning, while Eterna’s sharp tax decline despite stronger earnings points to either the crystallisation of tax losses or a shift in deferred tax positions.”

That trend was visible in companies such as Beta Glass Plc, whose tax expense declined by 22.6 per cent to N4.04bn following weaker profitability, rising finance costs, and higher foreign exchange losses.

Eterna Plc also cut its tax charge by 63.9 per cent despite posting stronger profits, suggesting lower effective tax exposure and possible tax relief adjustments.

In the Services sector, Red Star Express, C & I Leasing, and Trans-Nationwide Express all recorded lower tax payments amid weaker profitability or reduced effective tax rates.

Several firms, including DAAR Communications Plc, Morison Industries Plc, and SCOA Nigeria Plc, recorded zero tax obligations because of accumulated losses, weak profitability, or tax-loss carry-forwards.

Lead economist and fixed income strategist at CardinalStone, Olaolu Boboye, said company-specific tax waivers, pioneer status, deferred tax adjustments, and transitions under the Petroleum Industry Act were influencing effective tax rates.

“We need to check, per company, what made some companies pay lower taxes. A company can be granted pioneer status, which means it pays lower taxes. Oil and gas companies transitioning under the PIA may also pay lower taxes compared to the old petroleum profit tax regime,” Boboye said.

SBM Intelligence’s Effiong added that while Nigeria’s new tax laws could reduce headline tax rates over time, most large firms should not expect a sharp drop in effective tax rates.

“The headline statutory rate is coming down, but most real-sector companies should not expect a clean, one-for-one reduction in their effective tax rate. For larger firms, the new laws deliver a lower nominal rate, but it is offset by new layers of taxation, including a development levy and a 15 per cent global minimum effective tax,” he said.

Afrinvest’s Keripe also noted that tax reforms were aimed more at broadening the tax base, improving compliance, and simplifying administration than aggressively reducing corporate tax obligations.

The Petroleum Products Retail Outlets Owners Association of Nigeria has said increased competition in the downstream petroleum sector forced the Dangote Petroleum Refinery to slash the ex-depot price of diesel by N200 per litre.

Checks on Petroleumprice.ng showed that the price of diesel dropped from N1,800 to N1,600.

The National Public Relations Officer of PETROAN, Dr Joseph Obele, disclosed the association’s position in a statement on Tuesday, describing the development as a clear indication that competition, not monopoly, would deliver lower fuel prices for Nigerians.

According to him, the refinery reduced the price of Automotive Gas Oil, popularly known as diesel, from N1,800 per litre to N1,600 per litre after fresh imported products entered the Nigerian market

Obele said, “The Dangote refinery recently took legal action after NMDPRA granted five import licences to marketers for the importation of petroleum products.

“Over the weekend, several of the vessels reportedly arrived, and today the refinery reduced the price of AGO, commonly known as diesel, by N200. The reduction is from N1,800 to N1,600,” he stated.

The PETROAN spokesman described the price cut as a direct consequence of market rivalry in the deregulated downstream sector. “This development is widely seen as a positive impact of increased competition in the downstream petroleum sector,” Obele said.

According to him, the latest reduction may have been strategically targeted at importers whose products were already en route to the country, “as the new selling price at the Dangote refinery is significantly lower than the landing cost of the importers”.

Obele maintained that the development further strengthened arguments against monopoly in the petroleum sector. “All hail competition and say no to monopoly in the petroleum industry. The more the competition, the better prices consumers will enjoy,” he added.

The development comes amid an ongoing legal dispute involving the Dangote refinery against the Attorney General of the Federation and the Nigerian National Petroleum Company Limited over fuel importation into Nigeria.

The refinery had approached the Federal High Court in Lagos to challenge the issuance of petroleum import licences by the Nigerian Midstream and Downstream Petroleum Regulatory Authority to some marketers and oil trading firms.

The Dangote refinery, in the suit, reportedly argued that the continued issuance of import permits was undermining local refining and discouraging investments in domestic petroleum production.

The refinery also maintained that Nigeria has sufficient local refining capacity to meet domestic demand and therefore questioned the justification for continued fuel imports.

But the Nigerian National Petroleum Company Limited told the Federal High Court in Lagos that petroleum products from the Dangote Petroleum Refinery and Petrochemicals FZE are sold at “significantly high and fluctuating market prices”, warning that granting the refinery’s requests could hand it monopoly control of Nigeria’s downstream petroleum sector.

FCMB Group Plc has said the Ojude Oba Festival is no longer just a cultural celebration but a growing economic driver that is increasingly shaping tourism, enterprise development, and creative industry opportunities in Nigeria.

It stated that as global attention turns to Ijebu-Ode, the century-old festival reflects a new generation’s embrace of heritage, identity, and cultural confidence, stressing that every year in Ijebu-Ode, history arrives on horseback.

“It comes draped in aso-ofi and embroidered fabrics. It moves to the rhythm of drums, prayers, and praise chants. It gathers in age-grade regberegbe processions and the proud pageantry of warrior families whose histories span generations.

“What began over a century ago as a gathering of Muslim converts paying homage to the Awujale — Paramount Ruler of Ijebuland — has evolved into one of Africa’s most recognised cultural spectacles, a living expression of memory, identity, enterprise, and belonging,” the bank stated in a statement.

It noted that for FCMB Group Plc, Ojude Oba represents something even deeper: the reawakening of cultural confidence across Africa. Speaking ahead of the 2026 Ojude Oba Festival, FCMB said the growing global fascination with the festival reflects a broader shift among Africans at home and in the diaspora who are reconnecting with indigenous identity, heritage, and community in ways that feel modern, aspirational, and globally relevant.

“Ojude Oba is no longer simply a cultural festival,” said FCMB’s Divisional Head of Corporate Affairs, Diran Olojo. “It has become a powerful expression of how African culture continues to evolve without losing its roots. What we are witnessing is the meeting point of heritage and modern identity, where tradition is not preserved as nostalgia, but lived confidently and projected to the world.”

This year’s festival, themed “Celebrating the Legacy of Oba Sikiru Adetona,” will be held on May 29 in Ijebu-Ode, Ogun State. The event honours the late Awujale of Ijebuland, Oba Sikiru Kayode Adetona, whose reign transformed Ojude Oba from a respected local celebration into a globally recognised cultural institution that now attracts visitors, creatives, entrepreneurs, investors, and media attention from around the world.

The bank stated that for more than two decades, it has maintained a steady relationship with the festival, long before social media amplified its visual splendour globally. According to the Group, that commitment has always been rooted in recognising that enduring cultural institutions play an important role in strengthening social cohesion, preserving collective memory, and supporting economic activity.

Across hotels, fashion houses, catering, transportation, photography, entertainment, trade, and tourism, the festival now supports a wide ecosystem of livelihoods and enterprise extending beyond Ogun State.

“At a time when nations are searching for authentic expressions of identity and influence, culture has become one of Africa’s strongest assets,” Olojo said. “Festivals like Ojude Oba demonstrate that heritage and enterprise are not separate conversations. Culture creates emotional connection, but it also creates opportunity, visibility, confidence, and economic value for communities.”

FCMB noted that the renewed attention around Ojude Oba also reflects a generational shift in how younger Africans engage with tradition — not as an obligation, but as identity, style, and self-expression.

Among the cultural figures associated with this renewed energy is Farooq Oreagba, whose now-iconic appearances at the festival have come to symbolise Ojude Oba’s expanding global visibility and contemporary appeal. FCMB said collaborations with cultural personalities are guided by shared values around authenticity, responsible influence, creativity, and pride in African identity.

The Group also paid tribute to the late Awujale for preserving the dignity and continuity of the institution over decades of social change, while commending the Regent Awujale and Ogbeni Oja of Ijebuland, Olorogun (Dr) Sonny Kuku, for sustaining the kingdom’s cultural vision and unity during this important transition period.

FCMB further acknowledged the contributions of the Ogun State Government, the Ojude Oba Festival Organising Committee, community leaders, the regberegbe groups, and the wider Ijebu community for sustaining one of Nigeria’s most enduring cultural landmarks.

The Chairman of the Ojude Oba Festival Organising Committee, Chief Olu Okuboyejo, described the festival as a symbol of continuity, peaceful coexistence, and collective pride.

“Ojude Oba remains one of the greatest cultural assets of the Ijebu people and an important contribution to Nigeria’s cultural diplomacy,” he said. “This year, almost ninety age groups and twenty-five warrior families will participate in the celebrations.”

“Today, as cameras from across the world turn toward Ijebu-Ode once again, Ojude Oba continues to tell a larger story — that African culture is not fading into memory. It is adapting, expanding, and finding new relevance across generations and borders.

Heavyweight financial and manufacturing stocks dragged the Nigerian Exchange Limited down by 0.25 per cent last week, offsetting minor gains recorded across the banking and oil sectors. The benchmark NGX All-Share Index closed the week ended 22 May 2026 lower at 249,712.37 points, down from the 250,330.92 points recorded the previous week.

Similarly, the total market capitalisation of listed equities depreciated 0.23 per cent to close the five-day trading window at N160.077tn, representing a loss of billions of naira for equity portfolios. This downward movement was heavily driven by structural weakness in the manufacturing and retail protection segments, as the NGX Industrial Goods Index dropped 1.24 per cent to close at 12,252.18 points, while the NGX Insurance Index led the broader sectoral contraction by shedding 1.77 per cent to finish at 1,245.52 points.

Conversely, the banking sector provided a resilient counterweight to the bearish momentum, with the NGX Banking Index advancing 1.11 per cent to close the five-day trading window at 2,416.78 points.

Turnover volume plunges

Market liquidity experienced a sharp contraction compared to the preceding trading window. A total turnover of 3.875 billion shares worth N161.76bn was traded by investors in 334,745 deals. This stood in contrast to a total of 7.772 billion shares valued at N374.04bn that exchanged hands the previous week in 402,945 deals, indicating an asset-turnover contraction of approximately 50 per cent.

The Financial Services Industry maintained its dominance on the activity chart. Measured by volume, the sector led with 2.410 billion shares valued at N69.71bn traded in 126,919 deals. The banking sector’s activity alone contributed 62.19 per cent and 43.10 per cent to the total equity turnover volume and value, respectively. The Services Industry followed on the activity scale with 409.31 million shares worth N5.41bn in 25,908 deals, while the Oil and Gas Industry took third place with a turnover of 294.86 million shares worth N31.50bn in 26,738 deals.

Trading in the top three equities, including Sterling Financial Holdings Company Plc, Fidelity Bank Plc, and Access Holdings Plc, accounted for 1.092 billion shares worth N19.53bn in 21,683 deals, contributing 28.18 per cent to the total weekly equity turnover volume.

Despite the broader market slide, several equities bucked the bearish trend. Associated Bus Company Plc led the price gainers chart with a 44.82 per cent appreciation to close at N9.08 per share. Publishing counters also witnessed strong demand, with Academy Press Plc jumping 29.79 per cent to close at N9.15 and University Press Plc gaining 28.00 per cent to settle at N6.40 per share. Other notable gainers included International Energy Insurance Plc, which climbed 22.22 per cent to close at N3.41.

Conversely, Sovereign Trust Insurance Plc topped the price decliners table, shedding 22.45 per cent of its value to close at N2.28 per share. Logistics operator Trans-Nationwide Express Plc dropped 18.98 per cent to settle at N5.72, while manufacturing major CAP Plc fell 14.85 per cent to close at N199.00 per share. Berger Paints Plc also declined 12.64 per cent to close at N147.60.

While the benchmark index finished lower, select components, like the NGX Banking Index (+1.11 per cent) and the NGX Oil/Gas Index (+0.07 per cent), managed resilient postings, signalling highly selective asset allocation by local institutional funds.

Sovereign debt expansion

The fixed-income segment recorded significant regulatory activity as the Federal Government listed its April 2026 FGN Savings Bonds on the daily official list on Monday, 18 May. The listings comprised N864.96m under the two-year tenor maturing in 2028 with a 13.082 per cent coupon and N2.77bn under the three-year tenor maturing in 2029 with a 14.082 per cent coupon rate.

Fuel prices may drop in the coming days if oil prices continue to plunge following ongoing peace talks between the United States and Iran. This came as oil prices fell from $111 last week to $97 on Monday morning.

The PUNCH had earlier predicted that a major drop in oil prices might be imminent if the United States and Iran reached an agreement that would reopen the Strait of Hormuz. As of Sunday, Brent crude hovered between $103 and $105 amid positive signals that the warring nations were ready to end the months-long conflict.

As predicted, prices dropped sharply to $97.48 in the early hours of Monday, fuelling speculation over a possible reduction in fuel prices if the Strait of Hormuz is eventually reopened.

Recall that crude oil, the major input for fuel production, rose from below $70 since the US-Iran war began on February 28. In about three months of the conflict, crude traded above $100 and climbed beyond $115 at some points, leading to a sharp rise in fuel prices globally.

In Nigeria, petrol prices increased from N830 per litre to the current N1,300. Diesel and aviation fuel prices also rose sharply, with airline operators threatening to suspend operations.

As crude prices continued their downward trend in recent days, speculation intensified that the Dangote Petroleum Refinery may consider reducing petrol prices.

There were reports that the US and Iran had agreed in principle to a deal aimed at winding down the conflict in the Middle East by reopening the Strait of Hormuz.

US President Donald Trump had on Saturday said the Strait of Hormuz would be reopened as part of a proposed agreement involving the United States, Iran, and several Middle Eastern countries amid efforts to end the ongoing Iran conflict.

Trump disclosed this in a post on the Truth Social platform after a series of calls with leaders of Saudi Arabia, the United Arab Emirates, Qatar, Pakistan, Türkiye, Egypt, Jordan, Bahrain, and Israel.

According to him, an agreement had been negotiated, subject to finalisation between the United States, Iran, and several other countries. The American leader added that final aspects and details of the deal were still being discussed and would be announced shortly.

Speaking on the strategic waterway at the centre of the conflict, Trump declared that the Strait of Hormuz, through which 20 per cent of global oil passes, would be reopened.

On Sunday, Trump said talks with Iran were “proceeding in an orderly and constructive manner”, adding that he had instructed his representatives not to “rush” into a deal because time was on their side.

Meanwhile, Iran confirmed on Monday that talks with the US were progressing, though it said signing an agreement was not imminent. According to the BBC, Iran confirmed that some progress had been made in talks with the US, but a deal “is not imminent”.

Foreign ministry spokesman Esmail Baqai made the remarks after US Secretary of State Marco Rubio said an agreement could possibly be reached on Monday.

“It is correct to say that we have reached a conclusion on a large portion of the issues under discussion. But to say that this means the signing of an agreement is imminent, no one can make such a claim,” Baqai said in Tehran on Monday.

The memorandum of understanding between the US and Iran reportedly involves a 60-day ceasefire extension, reopening the Strait of Hormuz, and a framework for further negotiations over Iran’s nuclear programme.

The Federal Government has cancelled $717.7m in undisbursed World Bank financing for Nigeria’s troubled electricity sector, effectively terminating the remaining portion of a $1.52bn power sector recovery programme amid mounting tariff shortfalls, worsening financial pressures, and persistent implementation challenges across the industry.

Documents obtained by The PUNCH from the World Bank website on Monday showed that the cancellation followed a formal request by the Federal Government and a joint decision by both parties to discontinue financing under the Power Sector Recovery Performance-Based Operation due to evolving sector realities and the inability to achieve key reform milestones.

According to the World Bank restructuring paper, the cancelled amount represents the entire undisbursed balance remaining under the programme. “The restructuring will result in the cancellation of the entire undisbursed balance in the amount of $717.7m equivalent, and no further disbursements will be made under the Program following approval of this restructuring,” the bank stated.

The bank also disclosed that the programme’s closing date had been brought forward from June 30, 2027, to May 31, 2026, effectively ending the operation more than a year ahead of schedule. The cancelled facility formed part of a broader World Bank intervention designed to revive Nigeria’s struggling power sector.

The original Power Sector Recovery Performance-Based Operation was approved on June 23, 2020, with financing of about $752.5m equivalent. The programme was structured to improve electricity supply reliability, strengthen the sector’s financial and fiscal sustainability, and enhance accountability among key institutions in the electricity value chain.

Following initial progress recorded under the programme, the World Bank approved an Additional Financing package of approximately $763.5m equivalent on June 9, 2023, to consolidate earlier gains and support a new phase of reforms. The financing became effective on June 19, 2024, and extended the project’s closing date to June 30, 2027.

Together, the original financing and the additional facility amounted to about $1.52bn.

However, while the parent programme achieved substantial results and largely disbursed its resources, the additional financing struggled to meet critical reform conditions, resulting in limited disbursements and eventual cancellation of the remaining funds.

The World Bank noted that Nigeria’s electricity sector continues to face deep-rooted structural challenges despite years of reforms and significant financial support.

The report stated that the sector still suffers from weak distribution performance, transmission bottlenecks, underutilisation of available generation capacity, and persistent financial imbalances.

According to the bank, high technical, commercial, and collection losses across the distribution segment, combined with inadequate cost recovery, have created a recurring mismatch between revenues generated by the sector and its actual operating costs.

“These constraints have created recurrent financing gaps, most notably in the form of tariff shortfalls, which generate liquidity pressures across the value chain and weaken the operational and financial performance of sector institutions,” the report said.

The Federal Government developed the Power Sector Recovery Programme as a framework to restore the sector’s financial viability and reduce its fiscal burden on public finances.

The programme included plans to progressively eliminate tariff shortfalls, improve operational performance among power sector institutions, and strengthen regulatory oversight and accountability mechanisms.

According to the World Bank, implementation of the original operation delivered notable results. The report stated that tariff shortfalls fell by 71 per cent between 2019 and 2022, declining from N581bn to N166bn.

During the same period, regulatory cost recovery improved significantly from 56 per cent to 94 per cent, while annual electricity supplied to the distribution grid increased by 13 per cent between 2018 and 2021.

The bank said all standard disbursement-linked indicators and global indicators attached to the original programme were fully achieved. “Implementation of the parent operation was satisfactory, brought substantial results, and fully disbursed the PforR component as all DLRs were achieved,” the report stated.

Encouraged by those gains, the World Bank approved the additional financing package to address remaining structural weaknesses and deepen reforms under the Power Sector Recovery Programme.

The new facility was expected to support the development of a sustainable financing framework for the sector, improve operational performance through implementation of performance improvement plans, and strengthen governance arrangements among electricity institutions, particularly the Transmission Company of Nigeria.

However, the anticipated reforms failed to materialise within the expected timeframe. The World Bank attributed much of the setback to major macroeconomic developments that dramatically altered the operating environment.

According to the report, the liberalisation of Nigeria’s foreign exchange market in June 2023 triggered a sharp depreciation of the naira, leading to a substantial increase in the cost of natural gas used for electricity generation.

The bank explained that more than 70 per cent of electricity supplied into Nigeria’s national grid is generated using natural gas, whose pricing is denominated in United States dollars.

“The liberalisation of the foreign exchange market in June 2023 led to a significant depreciation of the local currency Naira, which resulted in a big increase in prices of natural gas used to produce above 70 per cent of electricity injected in the national power system,” the report stated.

At the same time, electricity tariffs for most consumers remained largely unchanged despite rising generation costs. The World Bank noted that electricity tariffs had effectively been frozen since early 2023, except for Band A customers, whose tariffs were adjusted to cost-reflective levels in April 2024.

This widening gap between actual electricity production costs and revenues collected from consumers resulted in a sharp increase in tariff shortfalls. According to the report, annual tariff shortfalls rose from a low of N140bn in 2022 to approximately N1.9tn in both 2024 and 2025.

“Due to the mismatch between the electricity generation costs and the sector tariff revenues, the tariff shortfalls increased sharply in the last 3 years, moving from a low of N140bn in 2022 to a high of N1.9tn per year in 2024 and 2025, putting serious pressure on the limited Federal Government of Nigeria’s fiscal space,” the World Bank said.

The report explained that the sharp deterioration in sector finances prevented Nigeria from achieving key global indicators attached to the additional financing package.

The bank noted that the required indicators were not achieved in 2023, 2024 or 2025 because authorities failed to establish a credible and fiscally sustainable financing plan capable of addressing the growing tariff deficits.

According to the report, the absence of a comprehensive financing framework and a declining trajectory of tariff shortfalls made it impossible to satisfy major programme conditions.

The bank stated, “Recent financing plans have not fully identified sufficient sources of funding to cover tariff shortfalls, nor established a credible trajectory for their reduction.”

Apart from financing challenges, implementation delays also contributed to the programme’s difficulties. The World Bank cited delays in aligning performance improvement plans with eligible expenditures, particularly those involving the Transmission Company of Nigeria, as well as challenges linked to verification requirements for key sector institutions.

“These constraints have limited the ability to trigger disbursements even where elements of progress have been achieved,” the report stated.

As a result, broader disbursements under the additional financing arrangement failed to materialise as expected. The World Bank disclosed that overall implementation progress under the additional financing remained “Moderately Unsatisfactory.”

Financial data contained in the restructuring document illustrates the extent of the programme’s underperformance. Under the International Bank for Reconstruction and Development component, the World Bank had committed $449m. However, only $41.24m had been disbursed, leaving $407.76m undisbursed and a disbursement rate of just 9.18 per cent.

Under the International Development Association component, $754.82m had been disbursed out of a total commitment of $1.063bn, leaving $308.53m undisbursed. The bank further noted that while about 95 per cent of the parent operation had been successfully disbursed, only around nine per cent of the additional financing package had been released.

“Of the AF combination of a loan and a credit totalling $763.5m equivalent, only 9 per cent, corresponding to prior results of the PforR, have been disbursed,” the report stated.

The World Bank concluded that the programme’s original design had become increasingly misaligned with prevailing realities in Nigeria’s electricity sector. “Taken together, these developments point to a misalignment between the design of the operation and the evolving implementation context,” the report stated.

According to the bank, achieving the programme’s objectives required coordinated progress across fiscal, policy, and operational dimensions, conditions that proved difficult to realise within the expected timeframe.

The Accountant-General of the Federation, Dr Shamseldeen Ogunjimi, earlier warned that Nigeria may reject loan facilities from the World Bank if delays in approval and disbursement persist, saying prolonged timelines could undermine the country’s willingness to proceed with such arrangements.

The warning was contained in a press statement last week by the Director of Press and Public Relations at the Office of the Accountant-General of the Federation, Bawa Mokwa.

Ogunjimi, who spoke in Abuja during a courtesy visit by a World Bank delegation led by Mrs Treed Lane, stressed that Nigeria expects timely processing of funding requests, given that the facilities are loans and not grants.

He said, “If approvals take more than six months, the Nigerian Government may no longer honour such arrangements,” highlighting concerns over bureaucratic delays in accessing development financing.

The AGF noted that as a responsible borrower, Nigeria should not be subjected to prolonged approval processes that could affect project execution timelines and broader development objectives. He therefore urged the World Bank to “expedite the approval and disbursement of project funds to Nigeria” to support the country’s priorities.

Ogunjimi emphasised that the loans carry repayment obligations, making it imperative that disbursement processes align with project schedules and fiscal planning frameworks.

However, the Senior External Affairs Officer at the World Bank, Mansir Nasir, earlier told The PUNCH that funds for projects financed by the institution were not disbursed at once but in instalments, depending on the nature of the project and financing instruments.

The PUNCH further learnt that Nigeria retained its position as the International Development Association’s third-largest borrower in the first quarter of 2026, despite a slight decline in its exposure to the World Bank’s concessional lending arm from $18.7bn in December 2025 to $18.5bn as of March 31, 2026.

The latest IDA financial statements showed that only Bangladesh, with $22.7bn, and Pakistan, with $19.2bn, ranked ahead of Nigeria, whose exposure accounted for about eight per cent of the institution’s $230.8bn loan portfolio.