The Central Bank of Nigeria (CBN) has challenged recapitalised banks to increase financing for productive sectors of the economy, including agriculture, manufacturing, infrastructure, and services. Deputy Governor Muhammad Sani Abdullahi stated that the success of the banking sector recapitalisation should be measured not only by the amount of capital raised but also by the quality of banking services and productive lending it supports.
Abdullahi spoke at the 38th Seminar for Finance Correspondents and Business Editors organised by the Finance Correspondents Association of Nigeria (FICAN) in Abuja. He disclosed that 33 banks had met the revised minimum capital requirements by the end of the two-year recapitalisation programme announced in March 2024, raising a combined N4.65 trillion. This stronger capital base gives banks greater capacity to support larger financing needs as the Nigerian economy expands.
The CBN deputy governor noted that Nigeria's aspiration to build a one-trillion-dollar economy by 2030 requires banks capable of mobilising and allocating capital on a much larger scale. Stronger capital buffers should enable banks to finance long-term infrastructure, support industrial expansion, facilitate international trade, and compete more effectively in regional and global markets.
Abdullahi stressed that recapitalisation alone would not guarantee a more resilient banking sector, saying capital must be supported by sound governance, effective risk management, and responsible lending. He urged banks to strengthen corporate governance, internal controls, and risk-management frameworks while guarding against excessive risk-taking.
The CBN would continue to pay close attention to governance, asset quality, liquidity, and large exposures as banks operate with their stronger capital bases. Abdullahi also urged banks to protect customer data, maintain reliable payment services, and recover quickly from disruptions. The wider economy should benefit from the recapitalisation over time, particularly as agriculture, manufacturing, services, and infrastructure require financing suited to their cash flows and investment horizons.
Abdullahi encouraged businesses to engage more closely with banks and improve their corporate transparency, governance, and sustainability, which increasingly inform credit assessments. He noted that the banking sector was entering the post-recapitalisation phase in an increasingly interconnected environment, where geopolitical uncertainty, climate-related risks, cyber threats, and rapid technological change could transmit shocks across borders.
The CBN's supervisory approach would continue to emphasise risk-based supervision, macroprudential surveillance, and enhanced stress testing, alongside consumer protection, fintech regulation, responsible innovation, and crisis preparedness. The resilience of banks would depend not only on adequate capital but also on their ability to anticipate emerging risks, absorb shocks, adapt, and recover.
Key points
- The CBN has challenged recapitalised banks to translate their stronger capital positions into increased financing for productive sectors of the economy.
- 33 banks have met the revised minimum capital requirements, raising a combined N4.65 trillion.
- The CBN's supervisory approach would continue to emphasise risk-based supervision, macroprudential surveillance, and enhanced stress testing.
