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With the resurgence of merchant banking in Nigeria’s financial landscape in recent years, the sector operators are beginning to indicate that it actually plays crucial role in the country’s economy especially in funding businesses.
Speaking to this, Stella-Marie Omogbai, Executive Director, Corporate Banking & Branches, FSDH Merchant Bank, one of the oldest surviving player in the segment, said in Nigeria’s evolving financial system, merchant banks remain a critical but often overlooked driver of corporate growth and ultimately economic stability.
Merchant Banks, according to her, though small, provide structured financial intermediation and advisory services that support various key sectors of the economy.
In this regard she said at the core of FSDH’s merchant banking operations is a deep understanding of wholesale and corporate businesses, different sectors of the economy, various economic cycles, capital markets, and client-centric innovation.
The bank’s capabilities, according to her, span Corporate and Wholesale banking, Global Markets and Treasury, Prestige, Financial Institutions, Business & Fintech banking, Custody, Women in Business banking, advisory, capital raising, debt structuring, liquidity management and electronic banking.
According to her Nigeria is navigating a unique monetary phase, with inflation easing to 22.9% in May 2025, and the Monetary Policy Rate (MPR) increasing to 26.25%, effectively pushing real interest rates into positive territory for the first time in years.
She stated: ‘‘These shifts in monetary dynamics—paired with a strengthening exchange rate (₦1,539/$ as of June 2025)—signal a tightening of liquidity across fixed income and debt markets.
‘‘FSDH has responded with a countercyclical strategy, helping clients rethink portfolio allocations, restructure capital, and hedge risk exposures amid interest rate uncertainty.
‘‘The firm’s proven track record in raising capital through bonds, commercial papers, and bespoke instruments has positioned it as a trusted partner for both mid-sized enterprises and large corporates seeking stability.
‘‘While merchant banks often operate with less public visibility than the commercial and retail-focused financial institutions, FSDH’s role in shaping strategic financing outcomes is immense. FSDH’s influence is especially evident in how it translates economic insights into client outcomes—from FX hedging advisory to equity financing and capital market listings.
‘‘For example, amid increased volatility in global markets and shifting trade dynamics, foreign portfolio investment (FPI) inflows into Nigeria reached US$5.03 billion in Q1 2025—a 200% increase year-on-year. FSDH has played a facilitative role in attracting and structuring these flows through bespoke advisory mandates and innovative investment vehicles.
‘‘This steady performance has not gone unnoticed. FSDH continues to gain recognition for its disciplined approach to deal structuring and due diligence, especially within sensitive sectors such as Energy, Manufacturing, Infrastructure, Agro-Allied and Healthcare to name a few.
‘‘The bank has also been instrumental in funding export-oriented companies, helping them tap into trade finance instruments amid FX reforms and renewed interest in non-oil revenue growth. FSDH is also an active partner in the import trade of clients.
‘‘The regulatory landscape is undergoing significant reform. Following the Central Bank of Nigeria’s (CBN) 2024 recapitalisation directive, banks now have until March 2026 to meet significantly higher capital thresholds. ‘‘For merchant banks, the new capital requirement has been pegged at ₦50 billion, up from the previous ₦15 billion. ‘‘FSDH has confirmed that it is already on track to meet this target comfortably, with a well-capitalised balance sheet and a conservative risk-weighted asset strategy.
‘‘In addition, the Finance Act 2024 introduced measures such as a harmonised development levy and an adjusted capital gains tax rate—both of which have implications for corporate financial planning.
‘‘FSDH is proactively advising clients on how to adapt. From transaction restructuring to tax optimization strategies, the bank’s thought leadership is being put to use across boardrooms nationwide.
‘‘Moreover, regulatory attention to anti-money laundering (AML) and know-your-customer (KYC) compliance has intensified. As a result, FSDH’s robust compliance framework—spearheaded by its Enterprise Risk and Compliance team—has become a competitive edge. It ensures that deals are not only profitable but sustainable and regulator-friendly’’.
According to her, FSDH is not just a participant in Nigeria’s financial ecosystem—it is also a thought leader shaping the industry’s evolution.
The bank has been a strong advocate for infrastructure finance, contributing to multi-sector financing solutions in transport, healthcare, power, and housing through both its Merchant Banking and Asset Management arms.
Its recent role in facilitating infrastructure debt funds and private placement memoranda for key stakeholders has demonstrated the strategic capacity embedded in merchant banking when guided by long-term thinking.
In addition, Omogbai said FSDH has been vocal in policy roundtables on unlocking Nigeria’s export finance potential, calling for better alignment between fiscal incentives and funding access for export-oriented businesses. Its capital market research and macroeconomic forecasts also continue to influence investor behavior and policy conversations.
She added, ‘‘As Nigeria aspires toward its $1 trillion GDP goal by 2030, merchant banking must play a greater role in funding national development. Institutions like FSDH are showing how this can be done—not with noise, but with precision, insight, and integrity.
‘‘In a world where trust, agility, and innovation define business success, FSDH Merchant Bank is proving that merchant banking—though quiet—is indispensable. It is the silent backbone of Nigeria’s business growth, shaping not only how companies are funded but also how they scale, innovate, and impact society’’.