The Central Bank of Nigeria (CBN) has raised the minimum capital requirement for Deposit Money Banks (DMBs) with national licenses from N25 billion to N200 billion.
The bank also increased the capital requirement for banks with regional licenses from N15 billion to N50 billion, and for those with international licenses from N100 billion to N500 billion.
The Acting Director of Corporate Communications at the bank, Mrs. Hakama Sidi-Ali, stated that merchant banks will now need a minimum capital of N50 billion. Additionally, Sidi-Ali declared that non-interest banks with national and regional authorizations must meet new requirements of N20 billion and N10 billion, respectively.
This development was reported by the News Agency of Nigeria (NAN) shortly after the Monetary Policy Committee (MPC) meeting. At the meeting, CBN Governor Yemi Cardoso called on Nigerian banks to quickly recapitalize their capital base to fortify the financial system.
In a circular issued by Mr. Haruna Mustafa, Director of the Financial Policy and Regulation Department, it was stated that all banks are mandated to fulfill the new minimum capital requirement within a 24-month period starting from April 1, ending on March 31, 2026.
Mr. Mustafa explained that this directive aims to bolster the resilience, solvency, and ability of banks to sustain the growth of Nigeria’s economy.
He encouraged banks to raise fresh equity capital via private placements, rights issues, and subscription offers to meet the new capital thresholds.
Additionally, he recommended considering Mergers and Acquisitions (M&As), as well as the upgrading or downgrading of license authorizations.
The minimum capital, he clarified, should consist solely of paid-up capital and share premium.
The new capital requirement will not be contingent upon the shareholders’ fund.
Tier 1 Capital will not qualify for satisfying the new capital mandate.
Despite the increase in capital, banks must adhere strictly to the minimum Capital Adequacy Ratio (CAR) required for their license authorization.
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Banks failing to meet the CAR must inject additional capital to rectify their standing, as per existing regulations, Mustafa noted.
He said that the minimum capital requirement for proposed banks shall be paid-up capital, adding that the new minimum capital requirement shall apply to all new applications for banking licences submitted after April 1.
“The CBN will continue to process all pending applications for banking licences for which a capital deposit had been made and an Approval-in-Principle (AIP) had been granted.
“However, the promoters of such proposed banks will make up the difference between the capital deposited with the CBN and the new capital requirement not later than March 31, 2026.,” he said.
He said that all banks were required to submit an implementation plan, clearly indicating the chosen options for meeting the new capital requirement and various activities involved with their timelines, nor later than April 30.
He said that the CBN would monitor and ensure compliance with the new requirements within the specified timeline.
