CBN resounds warning on sources of funds, insists banks must raise capital before deadline

• Nigerian banks are racing against the timepiece to conscionable caller recapitalisation targets by March 2026
• Amid this race, the CBN has issued a informing against accepting illicit funds during the capital-raising process
• The CBN has besides shared details astir the steps it would instrumentality to guarantee the banks comply with the guidelines

Legit.ng journalist Ruth Okwumbu-Imafidon has implicit a decennary of acquisition successful concern reporting crossed integer and mainstream media.

To conscionable the recapitalisation people earlier the deadline, Nigerian banks person been sourcing superior from assorted avenues, including rights issues and backstage placements.

The Central Bank of Nigeria (CBN) has warned Deposit Money Banks (DMBs) to cautiously vet the sources of funds they judge during superior raising, emphasizing that introducing illicit funds into the fiscal strategy could undermine stableness and endanger Nigeria's $1 trillion economical goal.

The Director of Banking Supervision astatine the CBN, Dr. Olubukola Akinwunmi, stated this astatine the 36th Finance Correspondents Association of Nigeria and Business Editors seminar successful Abuja connected Monday.

The caller superior thresholds volition guarantee that immoderate banks are near are beardown capable to upwind immoderate planetary economical shocks. Photo credit: Contributor/CBN
Source: UGC

Akinwunmi emphasized that the CBN would behaviour thorough checks to guarantee illicit funds bash not participate the fiscal system.

CBN releases caller superior threshold, deadline

Recall that the Central Bank of Nigeria raised minimum superior requirements for each banks successful March 2024, with a two-year deadline acceptable for March 31, 2026.

• International commercialized banks person to rise their superior to N500 billion
• National commercialized banks person to rise a minimum superior of N200 billion.
• Regional commercialized banks and merchant banks person a N50 cardinal people arsenic their minimum superior threshold.
• Non-interest banks are besides required to rise N20 cardinal and N10 cardinal for the nationalist and determination levels.
• For those applying for caller banking licenses, the caller minimum superior already applies to them.

Akinwunmi stated that the cardinal indicators amusement a resilient banking assemblage successful Nigeria, particularly with regards to superior adequacy, liquidity, and non-performing loans, and the recapitalisation workout would make a banking assemblage that is amended shielded against planetary shocks and economical uncertainties.

He said;

“The recapitalisation is besides astir strengthening the fiscal strategy for the future. Larger superior bases construe to greater capableness to money high-impact sectors specified arsenic infrastructure, manufacturing, and agriculture. Banks indispensable beryllium acceptable for the emerging planetary order.”

Akinwunmi added that the banks had a wide scope of options to research successful raising capital, including nationalist offers, mergers and acquisitions, rights issues, and strategical investments from extracurricular the country.

Some banks whitethorn downgrade license

Legit.ng stated successful an earlier study that immoderate banks were apt to downgrade their banking licence due to their inability to conscionable the minimum superior request earlier the deadline.

Akinwunmi, successful his remarks, noted that banks that take to standard down would not suffer their regulatory standing.

He added that the further investors connected committee would adjacent summation transparency and compliance of the banks with anti-money laundering and coercion financing laws, the PUNCH reports.

CBN's determination to rise superior requirements sparked immoderate reactions, particularly among those who thought it was excessively precocious and excessively sudden. Photo credit: CBN
Source: Getty Images

Recapitalisation volition stabilise the banking assemblage - Usoro

While delivering the keynote code astatine the seminar, Deputy Governor of CBN, Ms. Emem Usoro, noted that the recapitalisation workout came arsenic a argumentation effect to changes successful the planetary fiscal landscape.

She stressed that it would heighten the bank’s capableness to vie globally and to money and powerfulness the $1 trillion economy Nigeria aims to execute by 2030.

Referencing the 2004 recapitalisation exercise, Usoro explained the workout whitethorn trim the fig of banks but would stabilise the assemblage and marque the fiscal strategy much resilient to enactment improvement financing.

Access, GT, Zenith, 4 others rise N1.3 trillion

In related news, astir 7 Nigerian banks are connected way to conscionable the March 2026 recapitalisation deadline acceptable by the Central Bank of Nigeria (CBN).

The banks see Access Bank, Guaranty Trust Bank, Zenith Bank, FMCB, Sterling and Wema Bank, portion UBA and Fidelity volition denote their results later.

However, smaller banks are shunning nationalist offerings, choosing alternate platforms to rise the required capital.

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Source: Legit.ng