CBN Governor Says 16 banks have met new capital requirements

• N4.69trn outstanding Hinder new financial interventions •MPC Retains 27% rate

By Bonny Amadi with agency Reports

The Central Bank of Nigeria (CBN) says 16 banks have fully met the regulatory capital requirements, adding that the introduction of new financial intermediation has been halted due to outstanding N4.69 trillion.

Olayemi Cardoso, the CBN governor, made the dis closure on Tuesday during a press conference held after the 303rd monetary policy committee (MPC) meeting in Abuja.

He said the MPC expressed satisfaction with the sustained resilience of the banking system, with most financial soundness indica- tors remaining within regulatory thresholds.

“Members also acknowledged the substantial progress in the ongoing recapitalisation program, with 16 banks achieving full compliance with revised capital requirements,” Cardoso said.

He said the committee therefore urged the CBN to ensure a successful implementation and conclusion of the programme.

Speaking further, Cardoso said the banks are currently working to strengthen their financial buffers.

He explained that this is the intended outcome of the ongoing recapitalisation process, noting that 27 banks have raised capital so far.

“16 of them have fully complied. 27 of them have, through various means, raised capital,” Cardoso said.

“We are monitoring the developments and from every indication, it is going in the right trajectory.”

According to the governor, the country is now focused on developing a financial sector that is fit for purpose — one capable of building strong buffers and supporting the nation effectively in the years ahead.

“Many of you will also know that many of our banks are out on the African continent, and they have been innovative in various fairs,” he said.

“Again, these buffers that they are creating will help them to be in a position to better navigate the risks in the multiplicity of countries in which they operate.

“In return, that helps the Nigerians as well — the Nigerian traders, the Nigerian individuals —who go across all these various geographies.”

On March 28, 2024, CBN announced an increase in the minimum capital requirements for commercial banks with international license to N500 billion.

Following the development, several banks announced plans to raise funds through share, bond issuances.

Financial intermediation

On the introduction of new financial interventions, the Nigerian apex bank Governor says it cannot introduce new intervention programmes because N4.69 trillion of past interventions remain outstanding, limiting its ability to support new initiatives.

Olayemi Cardoso, CBN governor, said a review of past intervention schemes showed that the total value of interventions issued over a decade stood at N10.93 trillion.

“Now, we did a survey, a small study, of interventions in the central bank. And we came out with certain numbers, which showed that intervention, total amount of intervention was about N10.93 trillion, which goes back perhaps 2010 or 2013,” Cardoso said.