The Central Bank of Nigeria has urged banks to convert the N4.65tn raised under the recapitalisation programme into productive loans that support businesses, infrastructure, and economic growth. This call was made by the Deputy Governor, Corporate Services, CBN, Dr Muhammad Abdullahi, at the 38th Seminar for Finance Correspondents and Business Editors in Abuja. The seminar's theme was 'Towards a Robust and Resilient Financial System in the Post-Banking Sector Recapitalisation Era'.
According to Abdullahi, the success of the recapitalisation exercise should be measured beyond the amount of capital raised to include how the stronger balance sheets translate into productive lending and improved services. He emphasized that the quality of banking services and productive lending are crucial indicators of the recapitalisation's success. Abdullahi also highlighted the need for finance suited to the cash flows and investment horizons of various sectors, including agriculture, manufacturing, services, and infrastructure.
The recapitalisation programme, announced in March 2024, saw 33 banks meet the revised minimum capital requirements and raise a combined N4.65tn by the end of the two-year programme. This development gives the banking system a stronger capacity to support larger financing needs as the economy grows. Abdullahi linked stronger bank capital to Nigeria's ambition to build a $1tn economy by 2030, emphasizing that lenders would have to mobilise and allocate capital on a much larger scale.
Stronger capital buffers are expected to enable banks to finance long-term infrastructure, support industrial expansion, facilitate international trade, and compete more effectively in regional and global markets. However, Abdullahi warned that raising capital is only the beginning, stressing the need for stronger governance and risk management. He emphasized that boards and management must maintain sound controls, recognise risks early, and lend on the strength of viable projects.
The apex bank will continue to scrutinise governance, asset quality, liquidity, and large exposures, while expecting banks to strengthen cybersecurity, data protection, and business continuity arrangements. Abdullahi also emphasized that the benefits of recapitalisation must reach rural communities, women, young entrepreneurs, and smaller businesses, adding that stronger bank balance sheets should translate into wider access and better service.
Providing an update on broader financial sector reforms, Abdullahi noted that the average gap between the official and parallel foreign exchange rates had declined significantly. Total FX inflows stood at $10.82bn in July 2026, with $7.33bn coming from autonomous sources. Net foreign portfolio inflows reached $6.31bn between January and August, and gross external reserves stood at $55.60bn as of September 11.
Other stakeholders, including the Director of Corporate Communications and Investor Relations Department, CBN, Michael Akuka, and the Director of Stakeholder Engagement and Institutional Relations Department, CBN, Mrs Hakama Sidi-Ali, also spoke at the seminar. They emphasized the need for financial journalists to scrutinise the impact of the reforms and maintain engagement with the CBN to ensure effective communication and implementation of monetary policy and financial sector reforms.
Key points
- The Central Bank of Nigeria urges banks to convert N4.65tn raised under recapitalisation programme into productive loans supporting businesses, infrastructure, and economic growth.
- 33 banks met the revised minimum capital requirements and raised a combined N4.65tn by the end of the two-year recapitalisation programme announced in March 2024.
- Stronger bank capital is linked to Nigeria's ambition to build a $1tn economy by 2030, with lenders expected to mobilise and allocate capital on a much larger scale.
