How it unfolded
In March 2024, the Central Bank of Nigeria (CBN) initiated a comprehensive recapitalisation programme aimed at strengthening the capital base of the nation’s banks. This strategic move was prompted by the need to enhance the resilience of the financial system, ensuring that it could effectively support economic growth while withstanding both domestic and external shocks. The recapitalisation process was designed to meet revised minimum capital adequacy requirements, which are set at 10% for regional and national banks and 15% for banks with international authorisation.
Over the next 24 months, Nigerian banks collectively raised a remarkable total of N4.65 trillion in new capital, with the programme concluding on March 31, 2026. This substantial capital influx was crucial for bolstering the financial health of the banks involved. Notably, 33 of the 37 banks in Nigeria successfully met the revised minimum capital requirements, showcasing the effectiveness of the recapitalisation initiative.
Of the total capital raised, 72.55% was sourced from local investors, amounting to approximately N3.37 trillion, while 27.45% came from international markets, totaling around N1.28 trillion. This strong participation from both domestic and international investors reflects a sustained confidence in the Nigerian banking sector, as highlighted by Olayemi Cardoso, who stated, “The recapitalisation programme has strengthened the capital base of Nigerian banks, reinforcing the resilience of the financial system and ensuring it is well-positioned to support economic growth and withstand domestic and external shocks.”
The recapitalisation programme not only improved the asset quality of the banks but also reinforced balance-sheet transparency. As a result, all banks remained fully operational throughout the process, ensuring continued access to banking services for customers. This uninterrupted service was a critical aspect of the programme, as it allowed individuals and businesses to maintain their banking activities without disruption.
As the recapitalisation concluded, the CBN set a deadline of June 10, 2026, for the submission of implementation plans for new Anti-Money Laundering (AML) standards. This move is intended to further enhance the regulatory framework governing the banking sector, ensuring that banks are equipped to tackle emerging challenges in financial crime.
The successful completion of the recapitalisation programme marks a significant improvement over past consolidation episodes in Nigeria’s banking history. Dr. Muda Yusuf noted that this reflects stronger regulatory capacity, improved market discipline, and greater resilience within the banking system. The programme has established a stronger and more resilient banking system, better positioned to support lending, mobilise savings, and withstand domestic and global shocks.
In summary, the recapitalisation of Nigerian banks has been a pivotal development for the financial sector, enhancing its stability and capacity to support economic growth. The strong local and international participation in the capital raise underscores the confidence in Nigeria’s banking system, which is now better equipped to face future challenges.