The Central Bank of Nigeria (CBN) has issued routine transitional guidance for selected Nigerian banks as the March 31, 2026 recapitalization deadline approaches. The apex bank disclosed this in a statement released on Tuesday through its acting Director of Corporate Communications, Hakama Sidi Ali.
According to the CBN, these time-bound measures are specifically designed for a small number of banks still completing their transition from temporary regulatory support provided mainly in response to the economic impact of the COVID-19 pandemic.
Key Measures Implemented
The measures include temporary restrictions on capital distributions, such as dividends and bonuses, to support retention of internally generated funds and strengthen capital adequacy. The CBN emphasized that these adjustments are part of a broader, sequenced strategy to implement the recapitalization programme announced in 2023.
"This step is part of the CBN's broader, sequenced strategy to implement the recapitalization programme announced in 2023. The programme, designed to align with Nigeria's long-term growth ambitions, has already led to significant capital inflows and balance sheet strengthening across the sector," the statement partly reads.
The apex bank further clarified that most banks have either completed or are on track to meet the new capital requirements well before the final implementation deadline of March 31, 2026.
Limited Application and Supervisory Engagement
The CBN emphasized that these measures apply only to a limited number of banks, all of which have been formally notified and remain under close supervisory engagement. To support a smooth transition, the apex bank has allowed limited, time-bound flexibility within the capital framework, consistent with international regulatory norms.
"Nigeria generally maintains risk-based capital requirements that are significantly more stringent than the global Basel III minimums," the statement noted.
The CBN also highlighted that these adjustments reflect a well-established supervisory process consistent with global norms, noting that regulators in the U.S., Europe, and other major markets have implemented similar transitional measures as part of post-crisis reform efforts.
Context of the Guidance
This development comes in the wake of the CBN's earlier notice to forbearance banks, which banned dividend and bonus payments to foreign subsidiaries. That directive had raised concerns within Nigeria's financial sector about potential impacts on international banking relationships and investment flows.
The recapitalization programme is seen as a critical component of Nigeria's financial sector reform, aimed at strengthening banks' capacity to support the country's economic growth ambitions and enhance their resilience against future shocks.
Financial analysts suggest that these transitional measures will help affected banks build up their capital base gradually while maintaining operational stability during the recapitalization process.
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