Cardoso Steers Banks To Stronger Capital Base With Fresh N4.65tn Investments

…Domestic Capital Leads Recapitalisation Drive At 72.55%, Foreign 27.45%

…Thirty-Three Banks Scale Recapitalisation Hurdle, Emerge Stronger

…Recapitalisation Policy Reinforces Confidence In Banking Sector

Nigeria’s banking sector has emerged stronger following a sweeping recapitalisation drive led by the Central Bank of Nigeria under the leadership of Olayemi Cardoso, with lenders raising a total of N4.65tn in fresh capital over a 24-month period.

The exercise, which ended March 31, commenced in March 2024. It drew significant participation from both domestic and international investors, but was largely driven by local capital, which accounted for 72.55 per cent of the total funds raised.

Foreign investors contributed the remaining 27.45 per cent, underscoring a strong vote of confidence in the Nigerian banking system.

Details of the successful recapitalisation programme were contained in a statement issued on Wednesday in Abuja by the apex bank, jointly signed by the Director of Banking Supervision, Dr Olubukola Akinwunmi, and the Acting Director of Corporate Communications, Mrs Hakama Sidi-Ali.

In the statement, the apex bank said that, over the 24-month period, Nigerian banks raised a total of N4.65tn in new capital, strengthening the resilience of the financial system and enhancing its capacity to support the economy.

The bank said that the programme recorded strong participation from both domestic and international investors with 72.55 per cent of capital sourced locally and 27.45 per cent from international markets, reflecting
sustained confidence in the Nigerian banking sector.

The CBN confirmed that 33 banks had met the revised minimum capital requirements established under the programme.

“A limited number of institutions remain subject to ongoing regulatory and judicial processes, which are being addressed through established supervisory and legal frameworks.

“All banks remain fully operational, ensuring continued access to banking services for customers,’’ it said.

The apex bank said that the programme had strengthened Capital Adequacy Ratios (CAR), with the sector maintaining levels above international Basel benchmarks.

It said that minimum CAR thresholds remained at 10 per cent for regional and national banks and 15 per cent for banks with international authorisation.

“The recapitalisation implemented alongside an orderly exit from regulatory forbearance has improved asset quality, reinforcing balance sheet transparency and overall financial system stability,’’ CBN stated.

The apex bank said, to safeguard these gains, it had strengthened its risk-based capital adequacy framework requiring banks to conduct regular stress testing across defined scenarios and maintain appropriate capital buffers.

It said that key regulatory measures, including prudential guidelines and the supervisory framework, were subject to periodic review to support ongoing strengthening of governance, risk management, and sector resilience.

The bank said that the recapitalisation programme was carried out without disruption to banking services, ensuring continuous access for individuals and businesses throughout the process.

“The successful completion of the programme establishes a stronger and more resilient banking system, better positioned to support lending, mobilise savings, and withstand domestic and global shocks.

“The CBN remains committed to maintaining a stable, transparent, and resilient financial system that inspires confidence among depositors, investors, and the broader public, and to advancing the sustainability of the nation’s financial architecture,’’ it stated.

The CBN Governor, Mr Olayemi Cardoso, corroborated the gains, stating that the recapitalisation programme had strengthened the capital base of Nigerian banks, reinforcing the resilience of the financial system.

Cardoso said that it also ensured that the financial system was well-positioned to support economic growth and withstand domestic and external shocks.

Under the recapitalisation framework, the CBN had set new minimum capital thresholds of N500bn for commercial banks with international authorisation, N200bn for those with national authorisation, and N50bn for regional commercial banks.

Merchant banks are required to maintain a minimum capital base of N50bn, while non-interest banks must hold N20bn and N10bn for national and regional licences respectively.

The recapitalisation programme forms part of broader reforms aimed at strengthening the resilience of Nigeria’s banking system, enhancing its capacity to support economic growth, and positioning the sector to absorb future shocks.