Nigeria’s Banks Get Battle-Ready: CBN Leads the Charge for a Resilient, Trillion-Dollar Economy
As Nigeria eyes a bold economic future with a $1 trillion GDP target by 2030, the Central Bank of Nigeria (CBN) is leaving no stone unturned in strengthening the foundation — its banking sector. The latest push? A robust and strategic bank recapitalisation programme aimed at building stronger, safer, and more globally competitive financial institutions.
8 Banks Already Compliant — Many More on the Way
With the March 31, 2026 deadline in sight, eight Nigerian banks have already met the new minimum capital requirements, with several others accelerating efforts to do the same. This progress signals a sector-wide commitment to transformation and future readiness.
Why Recapitalisation Matters
CBN Governor, Olayemi Cardoso, made it clear: Nigeria cannot build a trillion-dollar economy on undercapitalised banks.
“Will Nigerian banks have sufficient capital to service a $1 trillion economy in the near future? In my opinion, the answer is ‘No’ — unless we take action.”
The recapitalisation policy is that action, designed not only to strengthen banks but also to:
• Support big-ticket projects like infrastructure and manufacturing
• Boost credit access for MSMEs
• Encourage investment in technology and digital finance
• Enable Nigerian banks to compete globally and withstand shocks like inflation or currency volatility
What’s the New Capital Requirement?
Effective April 1, 2024, the recapitalisation mandates:
• ₦500 billion for commercial banks with international licenses
• ₦200 billion for those with national licenses
• ₦50 billion for regional banks
• ₦50 billion for merchant banks
• ₦20 billion / ₦10 billion for non-interest banks (national / regional)
Notably, only paid-up share capital and share premium count — reserves and retained earnings don’t. This ensures new capital inflow rather than accounting maneuvering.
A Sector Still Strong — And Getting Stronger
Despite the demanding requirements, CBN insists the banking sector is sound:
• Non-performing loan (NPL) ratio remains under the 5% benchmark
• Liquidity ratios are well above regulatory minimums
• Stress tests confirm resilience across key indicators
• Most banks are raising funds through rights issues and public offerings
️ Banking for a Trillion-Dollar Nigeria
The recapitalisation is tightly linked to Nigeria’s economic ambitions. According to the Policy Advisory Council, reaching a $1 trillion GDP by 2030 demands a vibrant, well-funded financial system.
CBN Deputy Governor, Emem Usoro, said:
“We must consider the recapitalisation of our banks to be able to fund, finance and power the economy, and to favourably compete globally.”
She emphasized that achieving national goals will require collaboration across private and public sectors, and banks must be fit to fuel development projects and inclusive growth.
Mergers, Acquisitions & the Road Ahead
With the recap plan in full motion, M&A activity may increase. The CBN expects strategic alignments, especially among smaller banks needing capital buffers to survive or grow.
CBN’s Director of Banking Supervision, Olubuka Akinwunmi, noted:
“Banks are actively pursuing recapitalisation. Mergers and acquisitions will emerge as institutions assess their long-term strategies.”
Accountability & Compliance Get Tougher
Beyond capital, the CBN is enhancing regulatory enforcement:
• In 2025, banks must upgrade compliance frameworks to tackle evolving risks
• Recently, ₦15 billion in penalties were levied on 29 banks for violations — including AML and CFT breaches
• CBN now demands root-cause remediation, not just fines
A New Era of Financial Inclusion
Cardoso underscored that capital-rich banks can help scale digital finance, mobile money, and agent banking, especially in underserved areas.
Similarly, Other Financial Institutions (OFIs) like microfinance banks and mortgage lenders will be strengthened to support broader financial inclusion. Plans include:
• Implementing foreclosure laws to boost mortgage access
• Integrating with Global Standing Instruction (GSI) platform
• Better use of Development Finance Institutions (DFIs) to fund well-managed OFIs
Nigeria vs. the World: A Wake-Up Call
UBA Group CEO, Oliver Alawuba, pointed out a stark contrast:
In developed countries, bank assets range from 70–150% of GDP.
In Nigeria, just 11.97% as of 2024.
He believes the recapitalisation drive will not only close this gap but empower banks to fund oil & gas, fintech, green energy, and other critical sectors.
“This isn’t just about compliance,” he said. “It’s about shaping banks capable of leading Nigeria’s economic future.”
️ Final Take: The CBN’s Commitment
The CBN is clear: Nigeria’s banking sector is safe and stable — and recapitalisation is about future-proofing that stability.
Whether through new capital, stricter compliance, or strategic restructuring, the apex bank is committed to building a banking system that can power a globally competitive Nigeria.
The message is simple: Stronger banks. Stronger economy. Stronger future.
As Nigeria eyes a bold economic future with a $1 trillion GDP target by 2030, the Central Bank of Nigeria (CBN) is leaving no stone unturned in strengthening the foundation — its banking sector. The latest push? A robust and strategic bank recapitalisation programme aimed at building stronger, safer, and more globally competitive financial institutions.
8 Banks Already Compliant — Many More on the Way
With the March 31, 2026 deadline in sight, eight Nigerian banks have already met the new minimum capital requirements, with several others accelerating efforts to do the same. This progress signals a sector-wide commitment to transformation and future readiness.
Why Recapitalisation Matters
CBN Governor, Olayemi Cardoso, made it clear: Nigeria cannot build a trillion-dollar economy on undercapitalised banks.
“Will Nigerian banks have sufficient capital to service a $1 trillion economy in the near future? In my opinion, the answer is ‘No’ — unless we take action.”
The recapitalisation policy is that action, designed not only to strengthen banks but also to:
• Support big-ticket projects like infrastructure and manufacturing
• Boost credit access for MSMEs
• Encourage investment in technology and digital finance
• Enable Nigerian banks to compete globally and withstand shocks like inflation or currency volatility
What’s the New Capital Requirement?
Effective April 1, 2024, the recapitalisation mandates:
• ₦500 billion for commercial banks with international licenses
• ₦200 billion for those with national licenses
• ₦50 billion for regional banks
• ₦50 billion for merchant banks
• ₦20 billion / ₦10 billion for non-interest banks (national / regional)
Notably, only paid-up share capital and share premium count — reserves and retained earnings don’t. This ensures new capital inflow rather than accounting maneuvering.
A Sector Still Strong — And Getting Stronger
Despite the demanding requirements, CBN insists the banking sector is sound:
• Non-performing loan (NPL) ratio remains under the 5% benchmark
• Liquidity ratios are well above regulatory minimums
• Stress tests confirm resilience across key indicators
• Most banks are raising funds through rights issues and public offerings
️ Banking for a Trillion-Dollar Nigeria
The recapitalisation is tightly linked to Nigeria’s economic ambitions. According to the Policy Advisory Council, reaching a $1 trillion GDP by 2030 demands a vibrant, well-funded financial system.
CBN Deputy Governor, Emem Usoro, said:
“We must consider the recapitalisation of our banks to be able to fund, finance and power the economy, and to favourably compete globally.”
She emphasized that achieving national goals will require collaboration across private and public sectors, and banks must be fit to fuel development projects and inclusive growth.
Mergers, Acquisitions & the Road Ahead
With the recap plan in full motion, M&A activity may increase. The CBN expects strategic alignments, especially among smaller banks needing capital buffers to survive or grow.
CBN’s Director of Banking Supervision, Olubuka Akinwunmi, noted:
“Banks are actively pursuing recapitalisation. Mergers and acquisitions will emerge as institutions assess their long-term strategies.”
Accountability & Compliance Get Tougher
Beyond capital, the CBN is enhancing regulatory enforcement:
• In 2025, banks must upgrade compliance frameworks to tackle evolving risks
• Recently, ₦15 billion in penalties were levied on 29 banks for violations — including AML and CFT breaches
• CBN now demands root-cause remediation, not just fines
A New Era of Financial Inclusion
Cardoso underscored that capital-rich banks can help scale digital finance, mobile money, and agent banking, especially in underserved areas.
Similarly, Other Financial Institutions (OFIs) like microfinance banks and mortgage lenders will be strengthened to support broader financial inclusion. Plans include:
• Implementing foreclosure laws to boost mortgage access
• Integrating with Global Standing Instruction (GSI) platform
• Better use of Development Finance Institutions (DFIs) to fund well-managed OFIs
Nigeria vs. the World: A Wake-Up Call
UBA Group CEO, Oliver Alawuba, pointed out a stark contrast:
In developed countries, bank assets range from 70–150% of GDP.
In Nigeria, just 11.97% as of 2024.
He believes the recapitalisation drive will not only close this gap but empower banks to fund oil & gas, fintech, green energy, and other critical sectors.
“This isn’t just about compliance,” he said. “It’s about shaping banks capable of leading Nigeria’s economic future.”
️ Final Take: The CBN’s Commitment
The CBN is clear: Nigeria’s banking sector is safe and stable — and recapitalisation is about future-proofing that stability.
Whether through new capital, stricter compliance, or strategic restructuring, the apex bank is committed to building a banking system that can power a globally competitive Nigeria.
The message is simple: Stronger banks. Stronger economy. Stronger future.