Olamilekan Abayomi
The Central Bank of Nigeria (CBN) has concluded its recapitalisation exercise, with banks raising a total of ₦4.65 trillion to meet the new capital requirements. This milestone marks a significant step towards strengthening the banking sector and supporting Nigeria’s economic growth. The recapitalisation exercise is a testament to the CBN’s commitment to ensuring the stability and resilience of the financial system.
The recapitalisation exercise, which began in April 2024, aimed to increase the minimum capital requirements for banks to ₦500 billion for international commercial banks, ₦200 billion for national banks, and ₦50 billion for regional banks. The CBN’s goal is to enhance the resilience of banks and enable them to support the country’s economic development. This move is expected to improve the overall health of the banking sector and increase its capacity to provide credit to the real sector.
According to CBN Governor Olayemi Cardoso, the recapitalisation process has attracted significant foreign investment, with foreign investors contributing about 27% of the total capital raised. This demonstrates improved confidence in Nigeria’s banking sector amidst ongoing reforms. The CBN Governor noted that the recapitalisation exercise has also spurred interest from local investors, with many Nigerian investors participating in the capital-raising process.
Some of the banks that have met the new capital requirements include Access Bank, Zenith Bank, GTBank, Wema Bank, Jaiz Bank, and Stanbic IBTC. These banks have raised capital through various means, including rights issues, public offers, and private placements. The success of these banks in meeting the new capital requirements is a testament to their strong financial positions and commitment to supporting Nigeria’s economic growth.
The CBN has also directed banks to conduct comprehensive stress tests starting April 1, 2026, to assess their resilience to economic shocks. The results of these tests must be submitted by April 30, 2026. This move is aimed at ensuring that banks are adequately prepared to withstand potential economic downturns and maintain financial stability.
The recapitalisation exercise is expected to have a positive impact on Nigeria’s economy, enabling banks to provide more credit to the real sector and support large-scale infrastructure projects. The CBN’s efforts aim to position Nigerian banks as key players in the global financial landscape. With the new capital requirements in place, banks are expected to play a more significant role in driving Nigeria’s economic growth and development.
The new capital requirements are part of the CBN’s broader strategy to strengthen the banking sector and support Nigeria’s ambition to become a $1 trillion economy. The CBN is also working to enhance the regulatory framework and improve governance in the banking sector. These efforts are expected to promote financial stability, increase confidence in the banking sector, and drive economic growth.
As Nigeria’s banking sector continues to evolve, the CBN’s recapitalisation exercise marks a significant milestone in the country’s journey towards achieving its economic goals. With a stronger banking sector, Nigeria is well-positioned to attract more investment, drive economic growth, and improve the living standards of its citizens.
