Recapitalisation: 33 Banks’ Capital Hits N4.05trn, 20 Beat March 31 Deadline

BY MARK ITSIBOR, Abuja and BUKOLA ARO-LAMBO, Lagos

Governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, disclosed on Tuesday that 20 banks have fully met the new minimum capital requirements under the ongoing recapitalisation exercise. A total of 33 banks have so far raised funds, with verified and approved capital standing at N4.05 trillion as of 19 February 2026.

Cardoso made the disclosure at a press conference following the conclusion of the 304th meeting of the Monetary Policy Committee (MPC) — the Committee’s first meeting in 2026 — held in Abuja.

Of the N4.05 trillion raised, N2.90 trillion, representing 71.67 per cent, was sourced from domestic investors, while $706.84 million — equivalent to N1.15 trillion or 28.33 per cent — came from foreign participation. He added that 71 per cent of the fresh capital raised by deposit money banks was mobilised domestically.

“To date, 20 banks have fully met the new minimum capital requirement. A further 13 are at an advanced stage of their capital-raising processes and are expected to conclude within the stipulated time,” Cardoso said.

He described the mix of domestic and foreign inflows as reflective of broad-based investor engagement and confidence in the Nigerian banking sector.

The governor noted that institutions still finalising their recapitalisation plans are evaluating various strategic options, including consolidation where necessary.

On lenders currently under regulatory intervention, Cardoso explained that legal and structural considerations are shaping the sequencing of their recapitalisation efforts. He stated that it would be unreasonable to hold such institutions to the same timeline as peers that had approximately two and a half years to prepare following the announcement of the new capital thresholds.

“For institutions currently undertaking regulatory intervention, certain legal and structural considerations naturally influence the sequencing of their recapitalisation actions. It is unreasonable to expect that they would follow the same sequence as those that had ample time — about two and a half years since the announcement — to prepare,” he said.

He assured depositors that funds in such institutions remain secure and that operations continue under the close supervisory and regulatory oversight of the CBN.

“We remain actively engaged with all relevant stakeholders to ensure an orderly and credible outcome while maintaining financial stability,” he added.

Cardoso also announced that Nigeria’s gross external reserves rose to $50.4 billion as at mid-February 2026 — the highest level in 13 years — providing approximately 9.68 months of import cover. He attributed the milestone to growing investor confidence in the Nigerian economy.

MPC Cuts Rate to 26.5%

In what marks only the second rate cut since September 2020, the MPC reduced the benchmark Monetary Policy Rate (MPR) by 50 basis points to 26.5 per cent from 27 per cent, signalling a gradual shift in monetary policy after months of aggressive tightening aimed at curbing inflation and stabilising the foreign exchange market.

The Committee’s decision was based on a balanced assessment of risks to the outlook, suggesting that the ongoing disinflationary trend will continue, largely supported by the lagged impact of previous monetary tightening, sustained exchange rate stability and improved food supply.

Beyond the rate cut, the MPC retained the asymmetric corridor around the MPR at +50/-450 basis points. It also maintained the Cash Reserve Ratio (CRR) for Deposit Money Banks at 45 per cent and for Merchant Banks at 16 per cent.

In addition, the Committee retained the 75 per cent CRR on non-Treasury Single Account (TSA) public sector deposits, as well as the liquidity ratio at 30 per cent.

The Committee had earlier reduced the benchmark rate from 27.5 per cent to 27 per cent in September 2025. Prior to that, the last rate cut occurred in September 2020, when the apex bank lowered the MPR by 100 basis points from 12.5 per cent to 11.5 per cent.

Expert Reactions

Financial analysts have described the rate cut as cautious but strategic, noting that it reflects growing confidence in improving macroeconomic fundamentals while seeking to stimulate economic growth.

Commenting on the decision, market analyst at FXTM, Mathew Anthony, described it as a positive development.

“With favourable fundamental forces at play, it was always a question of how much rather than if rates would be cut in February. Although some were expecting a hefty 100-basis-point cut, this was still a positive move by the CBN, mirroring the dovish strategy of other major banks on the continent,” he said.

Anthony noted that the rate reduction was driven by cooling inflationary pressures, a stronger naira and rising foreign exchange reserves, adding that the move is “likely to boost confidence in the economic outlook ahead of the Q4 GDP report scheduled for release later this month”.

Analysts at Cowry Assets Management similarly stated that the slowdown in inflation has provided the CBN with room to slightly ease monetary conditions without risking price instability. Inflation has been moderating, with the latest reading at 15.10 per cent in January 2026.

They observed that the decision to leave other policy parameters unchanged shows that the CBN remains “cautious in its rate loosening, while still maintaining firm control over system liquidity”.

“The upshot from this MPC meeting is that a lower policy rate can gradually reduce borrowing costs for the real sector of the economy. While lending rates may not fall immediately, the direction is now more supportive of businesses and economic activity,” the analysts said.

They further noted that as interest rates begin to trend downwards, fixed-income returns may become less attractive over time, thereby supporting continued interest in equities and other risk assets, particularly for investors seeking stronger long-term returns.

“Cowry Research believes the decision signals a careful shift from aggressively fighting inflation to supporting growth, while still keeping financial stability in focus. It is a measured step — not a full easing cycle yet — but a clear change in tone,” they concluded.