As part of the continuing recapitalization process, the Central Bank of Nigeria (CBN) has warned deposit money banks not to get capital through illegal means, emphasizing that doing so could cause the financial system to become unstable.
Speaking at the 36th Finance Correspondents Association of Nigeria and Business Editors seminar held in Abuja on Monday, the Director of Banking Supervision at the CBN, Dr. Olubukola Akinwunmi, said the apex bank would enforce strict verification processes to ensure compliance.
“We ensure there is proper verification. And the verification is to ensure that we do not encourage illicit funds into our banking system. Illicit funds can only destabilize the banking system,” Akinwunmi stated.
The recapitalization initiative, which commenced on April 1, 2024, is expected to run for 24 months and aims to strengthen banks’ capacity to support Nigeria’s $1 trillion economy target.
Under the new framework, international commercial banks are required to raise their minimum capital to N500bn, while national and regional banks must meet thresholds of N200bn and N50bn, respectively.
Akinwunmi explained that the recapitalization exercise was designed not just to meet regulatory requirements but to prepare the sector for emerging economic and global challenges.
“The recapitalization is also about strengthening the financial system for the future. Larger capital bases translate to greater capacity to fund high-impact sectors such as infrastructure, manufacturing, and agriculture,” he added.
Also speaking, the CBN Deputy Governor, Ms. Emem Usoro, underscored the strategic importance of a robust banking sector in achieving national economic ambitions.
“We must consider the recapitalization of our banks to be able to fund, finance, and power the economy and favourably compete globally with its peers in other climes,” she said.
Usoro noted that the recapitalization effort is a proactive response to evolving global financial dynamics and a critical step toward building a resilient, globally competitive financial system.
The CBN emphasized that banks could explore various options to meet the new capital requirements, including mergers, public offers, and strategic foreign investments, while maintaining regulatory oversight and transparency.
Written By Daily Post Staff