The Central Bank of Nigeria (CBN) has shifted the emphasis of its banking-sector recapitalisation programme from how much capital lenders have raised to how effectively they deploy and manage the stronger balance sheets, setting the stage for tighter scrutiny of governance, risk management and productive lending.
The apex bank said the completion of the two-year recapitalisation exercise, which saw 33 banks meet the revised minimum capital requirements and collectively raise N4.65 trillion, represents only the beginning of a broader effort to build a more resilient financial system.
Muhammad Sani Abdullahi, deputy governor, Corporate Services, CBN, said at the apex bank’s 38th Seminar for Finance Correspondents and Business Editors in Abuja that stronger capital buffers must now translate into better-quality banking services and greater financing for productive sectors of the economy.
“Capital, however, is a starting point. Boards and management must maintain sound controls, recognise risks early and lend on the strength of viable projects,” Abdullahi said.
The seminar, themed “Towards a Robust and Resilient Financial System in the Post-Banking Sector Recapitalisation Era,” marked a shift in the regulatory conversation from balance-sheet strengthening to the quality of growth that banks generate from their enlarged capital bases.
N4.65trn capital raises reset banking operation
The CBN’s recapitalisation exercise, announced in March 2024, required banks to strengthen their capital positions to improve their capacity to absorb shocks and support economic expansion.
According to Abdullahi, 33 banks had met the revised requirements by the end of the two-year programme, collectively raising N4.65 trillion.
The apex bank, however, said the headline amount should not become the principal measure of the programme’s success.
“We should assess recapitalisation by the quality of banking services and productive lending it supports, as well as by the amount of capital raised,” Abdullahi said.
The CBN expects stronger balance sheets to enable banks to finance infrastructure, industrial expansion, international trade and other activities capable of supporting Nigeria’s ambition to build a $1 trillion economy by 2030.
The expanded capacity is also expected to improve access to finance for agriculture, manufacturing and services, as well as underserved groups including rural communities, women and young entrepreneurs.
With the capital-raising phase largely completed, corporate governance is emerging as one of the key tests of whether the recapitalisation delivers lasting improvements in banking-sector resilience.
The CBN warned that stronger balance sheets could still be undermined by weak governance, poor internal controls or excessive risk-taking.
Abdullahi said boards and management teams would be expected to demonstrate greater accountability and transparency while strengthening internal controls and identifying risks before they crystallise.
The regulator is also broadening its risk lens beyond conventional credit exposures as banking becomes increasingly digital and interconnected.
Risks relating to market and liquidity conditions, cybersecurity, operational failures, third-party technology dependencies and climate-related financial exposures will receive greater attention.
“A stronger balance sheet must be matched by stronger management of risk,” Abdullahi said.
The CBN is expected to continue monitoring asset quality, liquidity positions and large exposures through risk-based supervision, macroprudential surveillance and enhanced stress testing.
Banks whose capital positions are exposed to elevated risks could also be required to raise additional capital where necessary to strengthen their balance sheets.
The banking recapitalisation comes alongside broader reforms in the monetary and foreign exchange markets that the CBN said have improved macroeconomic conditions.
Abdullahi said the gap between official and parallel-market exchange rates had narrowed significantly, falling from an average of 68.2 percent between January and May 2023 to below 2 percent.
Foreign exchange inflows have also strengthened. Total inflows reached $10.82 billion in July 2026, with autonomous sources accounting for $7.33 billion, or almost 68 percent.
Net foreign portfolio inflows stood at $6.31 billion between January and August, while gross external reserves reached $55.60 billion as of September 11.
Inflation moderated to 15.43 percent in July, while real gross domestic product expanded by 4.43 percent in the second quarter of 2026.
The CBN, however, cautioned that improved macroeconomic indicators do not eliminate the pressures facing households and businesses.
