By 
Nigeria’s banking landscape is undergoing a historic transformation as the Central Bank of Nigeria (CBN) enforces a bold recapitalization policy aimed at strengthening the sector ahead of its March 31, 2026 deadline.
Under the new directive, banks are mandated to significantly boost their minimum capital thresholds or risk losing their operating licenses. This move, announced by CBN Governor Olayemi Cardoso, is part of a broader vision to position Nigerian banks as resilient financial institutions capable of supporting the government’s aspiration for a $1 trillion economy by 2030.
According to the new framework, international banks must now raise a minimum capital of ₦500 billion, while national and regional banks are required to meet ₦200 billion and ₦50 billion, respectively. Governor Cardoso emphasized that the policy transcends monetary targets, stating:
“This is about building institutions strong enough to drive economic transformation, fund critical infrastructure, and navigate global uncertainties.”
The recapitalization comes at a time of notable macroeconomic pressures, including persistent inflation, currency depreciation, and tepid private-sector lending. While the reform is intended to inject stability and investor confidence into the financial system, it presents a complex challenge for banks of all sizes.
Reports indicate that eight banks have already met the new capital benchmarks. Leading institutions such as Zenith Bank and Guaranty Trust Holding Company (GTCO) are leveraging their market influence through aggressive capital-raising initiatives, including rights issues and public offerings.
However, the path forward is more daunting for mid-tier and smaller banks. A Lagos-based financial analyst noted:
“Larger banks are well-positioned due to their reputational strength. Smaller players, however, face significant hurdles amid high interest rates and cautious investor sentiment.”
As the deadline approaches, analysts foresee a wave of mergers and acquisitions (M&As) akin to the 2005 consolidation, which reduced the number of banks in Nigeria from 89 to 25. Strategic partnerships, asset pooling, and license downgrades are emerging as potential survival tactics for banks unable to meet the new capital thresholds independently.
“We’re entering a period where synergy will be key to survival,” a banking consultant observed. “Many smaller banks will likely merge or revise their operational licenses to stay in business.”
Yet, the recapitalization policy has not been without criticism. Some stakeholders have raised concerns over potential shareholder dilution, particularly for retail investors, and the possibility of diverting funds away from critical sectors such as manufacturing and SMEs.
A local business advocacy group warned:
“While banks scramble to meet capital demands, smaller enterprises risk being edged out of the credit market. It’s crucial that the financial system remains inclusive.”
Despite these concerns, the CBN maintains that the exercise is pivotal for building a robust financial ecosystem capable of facilitating long-term economic growth. The policy is expected to enhance banks’ ability to fund transformative projects across infrastructure, energy, and industrial sectors.
As the countdown to March 2026 continues, Nigeria’s banking sector is entering a new era—one that will reward innovation, resilience, and strategic foresight. For banks that rise to the challenge, the future holds greater stability, competitiveness, and regional influence.
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