CBN Sets ₦500 Billion As Minimum Benchmark For Banks

In a bid to strengthen the banking sector, the Central Bank of Nigeria (CBN) has introduced new minimum capital requirements for banks, establishing a ₦500 billion benchmark for commercial banks with international authorization.

A circular issued by the Director of the Financial Policy and Regulation Department, Haruna Mustafa, outlines the new requirements, giving banks 24 months from April 1, 2024, to comply.

CBN spokesperson Hakama Sidi Ali confirmed the development, highlighting the revised capital bases for various categories of banks.

Commercial banks with national authorization now require ₦200 billion, while those with regional authorization need ₦50 billion.

Merchant banks must maintain ₦50 billion, and non-interest banks have new requirements of ₦20 billion and ₦10 billion for national and regional authorizations, respectively.

The announcement follows recent directives from CBN Governor Olayemi Cardoso, urging banks to expedite their recapitalization efforts to fortify the financial system.

This move marks the first adjustment to capital requirements since 2005, indicating a proactive measure to align with evolving economic landscapes and ensure the stability and resilience of the banking sector.

Banks have been instructed to submit implementation plans by April 30, 2024, outlining strategies to meet the new requirements.

The CBN vows to monitor and enforce compliance within the specified timeframe, emphasizing the importance of maintaining adequate capital adequacy ratios.

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