CBN Forbearance: Zenith, AccessCorp, Fidelity, FCMB State Compliance Levels

• …Announce next Dividend Payment Plans

BY BONNY AMADI

Four Nigerian top tier banks have announced their commitments to complying with the Central Bank of Nigeria’s (CBN} latest regulatory stand on Single Obligor Limits and regulatory forbearance which bars banks from paying dividend, issuing bonuses or making investments in their foreign subsidiaries.

Zenith Bank, Access Holdings, FCMB Group, and Fidelity Bank, have in their separate explanations and updates to the capital market community through the NGX Exchange, brought clarity on their commitment to exit all forms of regulatory forbearance with a termed period which invariably would not affect their corporate action declaration for the prevailing year.

Zenith Bank Plc in its report dated 17th June 2025, titled “Re- temporary suspension of dividend payments, bonuses and investments in foreign subsidiaries” signed by Michael O. Otu, Company secretary and obtained by our correspondent, explained that the bank has successfully raised and surpassed the new regulatory capital requirement of N500 billion. The bank’s exposure under the SOL forbearance relates solely to a single obligor. We are confident that this exposure will be brought within the applicable regulatory limit on or before 30th June 2025”

The bank explained further that with respect to the forbearance granted on other credit facilities, the bank confirms that this applies to only two (2) customers. “We have made substantial provisions in respect of these facilities and have taken appropriate and comprehensive steps to ensure full provisions by 30th June 2025.

It added that, upon completion, the bank will no longer be under any forbearance agreement in this regard. The bank expects to have exited all CBN forbearance visions by 30th June 2025. It added that, upon completion, the bank will no longer be under any forbearance agreement in this regard. The bank expects to have exited all CBN forbearance agreements by the end of the first half of 2025.

Accordingly, we remain confident that the bank will satisfy all relevant conditions to enable it to pay dividend to shareholders in the current year.

FCMB Group also, in its disclosure dated 17 June 2025, titled, “FCMB GROUP PLC’S STATEMENT ON CBN’S DIRECTIVE ON FORBEARANCE LOANS, said “The Bank has one (1) additional obligor (classified as a Stage 1 loan since drawdown to date) on the CBN forbearance for Single Obligor Limit (SOL). This Obligor will be brought within SOL limit by September 30th 2025, following the conversion to equity of a recently concluded N23.1 billion Convertible Loan and audited nine (9) months projected retained earnings.

It added that the Group has already received CBN approval for the capital verification of the Convertible Loan and “we are currently processing the other regulatory approvals required. We intend to conclude this process, including down streaming the capital proceeds to the Bank by the end of July 2025.”

This would effectively take the Share Capital and Share Premium Of the Bank to~N267 billion. Capital Adequacy will remain above the regulatory minimum of 15% for international banks post forbearance, reinforced with the addition of the converted equity by July 2025 and the planned audit of nine (9) months retained earnings”

FCMB group further disclosed that that Group’s Nigerian Banking Subsidiary currently has loans under CBN forbearance (credit exposures to 3 entities and 2 obligors) amounting to N207.6 billion as at 31st May 2025 (down from N538.8 billion as at September 30th, 2024).

It added that these forbearance loans are currently classified as Stage 2 loans. “The Bank has made provisions for these loans over the last few years, and intensified resolution efforts have led to over 60% reduction in its credit forbearance exposures.

“Once these loans exit the CBN forbearance regime, we anticipate that this would lead to an initial spike in Stage 3 loans to ~11.5% of the total loan book which would decline below 10% by the end of the financial year, based on anticipated loan book growth.

Access Holdings also in its release dated June 18, 2025, titled “Re: Central Bank Of Nigeria’s Letter On Temporary Suspension Of Dividend Payment, Bonuses, stated that, “the Bank is currently compliant with the single obligor limit requirement as of the date herein and will continue to ensure adherence to this regulation.

Regarding the regulatory forbearance on credit facilities, the Bank said that it will comply with the apex bank’s directive by June 30, 2025, while maintaining strong capital buffers and paying dividend to its shareholders.

Access Holdings added that, as of December 31, 2024, the Company’s banking subsidiary, Access Bank Plc (‘the Bank’) was the first bank to meet and exceed the Central Bank of Nigeria’s N500 billion minimum capital requirement for commercial banks with international authorization, as it assured “shareholders and stakeholders of our commitment to delivering sustainable value in the immediate and long term and thank them for their trust and support over the years”

Also, Fidelity bank has explained that the bank remains committed to adhering to all regulatory directives aimed at enhancing prudence in the banking sector.

“As a responsible financial institution, Fidelity Bank Plc is aligned with the CBN’s intent to ensure stronger capital adequacy within the industry,” the bank said.

Highlighting progress on capital mobilisation, the bank disclosed that it had successfully raised N273 billion through a recently concluded public offer and rights issue, which were oversubscribed by 237.92 per cent and 137.73 per cent, respectively.

“In line with the new N500 billion capital requirements for banks with international licenses, we are set to raise an additional N200 billion through a private placement in the 2025 financial year,” the bank noted.

It added that approvals for the private placement had already been secured from CBN and shareholders, with other regulatory consents currently being processed.

On the issue of exposure related to the SOL forbearance, the bank noted that it concerns only two obligors, with assurance that these exposures would be aligned with regulatory limits within the first half of the year.

Regarding the forbearance granted on other credit facilities, the bank stated that it involved four customers, adding that it has made significant provisions and is implementing measures to either fully provision or return the accounts to performing status by June 30.