Recapitalisation: CBN Orders Banks to Submit Capital Restoration Plan Ahead Of Deadline
- The bank recapitalisation deadline set by the Central Bank of Nigeria (CBN) is less than nine months away
- Meanwhile, the apex bank has issued fresh directives regarding the transition period and forbearance
- Among other things, the latest directive suspends payment of dividends and bonuses to directors for several banks
Ruth Okwumbu-Imafidon, a journalist with Legit.ng, has over a decade of experience in business reporting across digital and mainstream media.
As the bank recapitalisation deadline draws closer, the Central Bank of Nigeria (CBN) has issued a new directive to all Nigerian banks.
As per the directive, the banks are required to submit a detailed Capital Restoration Plan within 10 working days after the close of each quarter.
The directive takes immediate effect, beginning with the last quarter, which ended on June 30, 2025. This means banks have until Monday, July 14, 2025, to submit the first CRP.
Source: UGC
What must be contained in the CRP?
In a circular published on the CBN website and signed by the director of banking supervision, Dr. Olubukola Akinwunmi, the bank described the latest directive as part of steps to wind down the regulatory forbearance framework instituted during the coronavirus pandemic.
The circular reads:
“The plan should detail the management’s proposed strategies to restore full regulatory compliance, including (but not limited to) cost optimisation initiatives, risk asset reduction, significant risk transfers, and necessary business model adaptations.
“The plan must cover the entire period until full normalisation of capital and asset quality indicators are achieved. Plans submitted will be subject to regulatory review and approval, and will form the basis for continuous supervisory monitoring and engagement throughout the transition.”
The CBN said these initiatives would support Nigerian banks as they restore full prudential compliance and promote macro-financial stability in the country.
CBN terminates all waivers on SOLs
As part of steps to restore risk sensitivity in credit classification and provision, the apex bank has ended all COVID-19-era regulatory forbearance and waivers on Single Obligor Limits (SOL).
This is effective June 30, 2025, and will help improve asset quality. In addition, CBN has waived the requirement that banks retain fully provisioned loans for one year before write-off.
“To support asset quality clean-up, the requirement to retain fully provisioned loans for one year before write-off is temporarily waived for forbearance related facilities Banks may proceed with write-offs to reduce their Non-Performing Loan (NPL) ratios, provided internal governance requirements for such write-offs are met.”
CBN suspends several payments for Nigerian banks
The CBN circular also reiterated the suspension of dividend payments for Nigerian banks still benefiting from transitional concessions under the forbearance.
This would ensure that the banks channel the retained earnings to strengthen capital and mitigate against systemic risks.
In line with this, the CBN also reiterated the suspension of bonuses payable to directors and senior management as well as investments in foreign subsidiaries.
These restrictions were listed in an earlier circular dated June 13, 2025, and according to the CBN, they will remain in force for every bank, until the bank shows that capital levels and provisions are restored to full regulatory compliance.
The CBN urged the banks to work closely with the banking supervision department to ensure compliance and demonstrate transparency by providing quarterly disclosures on the provisioning status and reconciliation of affected credit exposures.
Source: Getty Images
However, banks like Zenith and Access have announced that they have fully exited the forbearance arrangement by June 30, 2025.
Two banks meet recapitalisation deadline
In related news, Legit.ng reported that Zenith Bank and Access Bank have already met the CBN's recapitalisation requirement ahead of the March 30, 2026, deadline.
The two banks also exceeded the N500 billion target set for international commercial banks. Others like Ecobank, Fidelity Bank, and First Bank are on course to beat the deadline.
Proofreading by James Ojo, copy editor at Legit.ng.
Source: Legit.ng
