Nigeria’s Banking Industry Remains Resilient, Says CBN

The Central Bank of Nigeria on Monday said that the Capital Adequacy Ratio (CAR) of the banking industry are within the regulatory thresholds as captured in the most recent economic report of 2023.

The statement is coming after the CBN said in its second quarter economic report for 2023 which was analysed by THE WHISTLER that the CAR of banks fell below the threshold for banks with international authorisation.

The report was published on the CBN website.

The report had said “The banking system Capital Adequacy Ratio (CAR) fell by 3.0 percentage points to 11.2 per cent, relative to the 14.2 per cent recorded in the preceding quarter.

“The ratio was above the 10.0 per cent benchmark for banks with national/regional authorisation, but below the 15.0 per cent threshold for banks with international authorisation.

“The development reflected a decline in the banks’ total qualifying capital relative to the increase in risk weighted assets due to the depreciation of the naira exchange rate, as a result of the adoption of a market determined exchange rate policy by the Bank.”

But in a fresh twist, the CBN said the CAR of banks with international authorisation was within the 15 per cent regulatory threshold in its most recent report.

The apex bank was however not specific about the period the ‘most recent Economic Report of 2023’ covered.

The apex bank said, “Nigerian banking industry remains resilient as key financial soundness indicators were within the regulatory thresholds as captured in the CBN’s most recent Economic Report of 2023.”

The CBN said in the statement that it is engaging players in the banking sector to discuss ways to sustain the level of confidence in the financial sector.

“Furthermore, the CBN is engaging with various critical stakeholders to sustain the level of confidence in the Nigerian financial sector,” the CBN said.