Recapitalisation: 20 Banks in Race to Escape CBN Hammer
At least 20 Nigerian banks have reportedly met the Central Bank of Nigeria’s (CBN) new recapitalisation requirements as the race intensifies ahead of the March 31 deadline for compliance with the apex bank’s far-reaching banking sector reforms.
Reports by The Nation indicate that the recapitalisation programme, which is designed to strengthen the financial system and enhance banks’ capacity to support economic growth, has entered a critical phase as lenders move to shore up their capital bases.
Under the revised framework issued by the CBN, banks are required to significantly raise their minimum paid-up capital and share premium, depending on their licence categories. International banks are expected to maintain a minimum of ₦500 billion, national banks ₦200 billion, and regional banks ₦50 billion.
Speaking at a recent financial sector forum in Lagos, the CBN’s Deputy Governor for Economic Policy, Dr. Muhammad Abdullahi, disclosed that about 20 banks had already crossed the new capital thresholds, describing the level of compliance as encouraging with weeks left to the deadline.
Among the leading lenders reported to have met the requirements are Guaranty Trust Bank, Access Bank, Zenith Bank, United Bank for Africa (UBA), First Bank of Nigeria and Fidelity Bank. Others include Wema Bank, Jaiz Bank, Ecobank Nigeria, Stanbic IBTC Bank, Citibank and Standard Chartered Bank.
However, industry sources say some banks are weighing strategic options to achieve compliance, including plans to downgrade their licence categories — such as moving from international to national, or from national to regional status — in order to align their operations with their capital positions.
The sources added that the CBN has indicated a willingness to allow flexibility in licence classifications, provided banks meet the regulatory conditions and submit verifiable capital positions.
Financial analysts expect a surge in capital-raising activities in the coming weeks, including rights issues, private placements and possible mergers, as lenders explore all available avenues to strengthen their balance sheets before the deadline.
Market watchers have described the current recapitalisation drive as more orderly than the sweeping consolidation exercise of 2004–2005, noting that the regulator’s phased approach is aimed at preserving financial stability while improving the resilience of the banking sector.
As the deadline draws closer, stakeholders say the outcome of the exercise will play a critical role in shaping the future structure of Nigeria’s banking industry and its ability to support long-term economic development.