By Adedapo Adesanya
The Central Bank of Nigeria (CBN) has unveiled new minimum capital requirements for commercial banks and other financial institutions, pegging the capital base at least N500 billion for commercial banks with international footprints.
This was contained in a circular signed by the CBN Director for Financial Policy and Regulation Department, Mr Haruna Mustafa, to all commercial, merchant, and non-interest banks and promoters of proposed banks. This development was also confirmed by CBN spokesperson, Mrs Hakama Sidi Ali, late on Thursday.
The apex bank emphasised that all banks are required to meet the minimum capital requirement within 24 months commencing from April 1, 2024, and terminating on March 31, 2026.
While banks with foreign authorisation were pegged at N500 billion, the new minimum capital base for commercial banks with national authorisation is now N200 billion, while the new requirement for those with regional authorisation is N50 billion just as the new minimum capital for merchant banks was also pegged at N50 billion,
Meanwhile, the new requirements for non-interest banks with national and regional authorisations are N20 billion and N10 billion, respectively.
Recall that on Tuesday, after the 294th Monetary Policy Committee (MPC), the governor of the CBN, Mr Yemi Cardoso, urged deposit money banks to quickly work on the recapitalisation of their capital base in order to strengthen the financial system towards a $1 trillion economy.
During his first public speech in November 2023, Mr Cardoso said commercial banks in the country would be directed to increase their capital base to service a $1 trillion economy ambition of the President Bola Tinubu administration.
This exercise is be coming 19 years after the CBN last increased capital base for banks in 2005, when the current Anambra State Governor, Mr Charles Soludo, then the apex bank chief increased the capital base from N2 billion to N25 billion.
There are also indications that due to the premium placed on this move, some banks may have to be sold or merged with more capable institutions.