By CBN increases minimum capital base for banks to N500bn
Ghazali Ibrahim
The Central Bank of Nigeria (CBN) has announced an increment in the capital base for mega banks to meet a total recapitalization target of N500 billion within a two-year timeframe.
This directive, issued by the central Bank, on March 28,2024, aims to bolster the financial resilience and stability of banks operating within the Nigerian financial landscape.
The CBN noted that commercial banks with regional authorisation are expected to achieve a N50 billion capital base. In contrast, merchant banks are expected to shore up their capital to N50 billion as the minimum capital requirement.
The apex bank directed non-interest banks with national and regional authorisations to boost their capital to N20 billion and N10 billion, respectively.
The decision to implement the recapitalization targets comes amid efforts by the CBN to fortify the banking sector against potential economic challenges and uncertainties.
The CBN’s move came two days after the Monetary Policy Committee hinted that it would change the capital base of the nation’s banks.
At the press briefing that followed the 294th MPC meeting on Tuesday, CBN Governor, Olayemi Cardoso, urged DMBs to expedite actions to increase their capital base to strengthen the financial system against potential risk.
In November 2023, Cardoso, at the 58th Annual Bankers’ Dinner organised by the Chartered Institute of Bankers of Nigeria, announced plans by the apex bank to carry out a fresh round of banking recapitalisation for the Deposit Money Banks, Punch reports.
