As regulatory scrutiny intensifies in Nigeria’s banking sector, Zenith Bank Plc has taken steps to reassure shareholders and market observers that its dividend payouts remain secure. Despite being listed among the financial institutions affected by the Central Bank of Nigeria’s (CBN) recent directive suspending dividends and foreign investments for banks under forbearance, Zenith Bank asserts that it is well-positioned to meet all requirements and exit regulatory oversight by mid-year.
CBN Directive Sparks Market Uncertainty
The CBN’s circular, issued on June 13, 2025, directed banks with unresolved forbearance arrangements to suspend dividends, bonuses, and new foreign investments. This move is part of the apex bank’s broader efforts to tighten regulatory standards and unwind temporary leniencies granted during the economic disruptions of the COVID-19 era.
The directive caused immediate concern in the capital markets, particularly as it affects several high-profile institutions including Zenith Bank, FirstBank, and Access Bank. Investors have since responded with caution, reassessing the outlook for short-term returns from the sector.
Zenith Bank: Financial Health Remains Robust
In response, Zenith Bank issued a statement dated June 17, 2025, through the Nigerian Exchange, clarifying its position and outlining the specific nature of its regulatory forbearance status.
The tier-1 lender disclosed that it has already met the new capital threshold of ₦500 billion mandated by the CBN. More importantly, it noted that its forbearance status stems from a single exposure that falls under the Central Bank’s Single Obligor Limit (SOL) — a regulatory cap that restricts the maximum amount a bank can lend to a single borrower.
The bank expects this specific issue to be fully resolved by June 30, 2025, effectively bringing it in line with regulatory expectations.
Minimal Exposure and Comprehensive Provisioning
Zenith further clarified that only two additional customers are connected to the remaining forbearance-related exposures. The bank emphasized that it has already made “substantial provisions” for these facilities and is confident that all outstanding issues will be fully addressed within the first half of the year.
“We have made substantial provisions in respect of these facilities and have taken appropriate and comprehensive steps to ensure full provisioning by 30 June 2025,” the bank stated.
Once resolved, Zenith expects to no longer fall under any CBN forbearance arrangements — a development that would clear the way for resumed dividend payouts and other shareholder rewards.
Dividend Outlook: Cautious Optimism
Zenith Bank concluded its update with an optimistic projection, noting that it remains on course to satisfy all regulatory conditions necessary to authorize dividend payments in the current fiscal year.
“We remain confident that the Bank will satisfy all relevant conditions to enable it to pay dividends to shareholders in the current year,” the statement read.
This proactive disclosure is seen as a strategic move to bolster investor confidence at a time when tighter regulatory measures are exerting pressure on banking equities across the Nigerian Exchange.
Conclusion
As the CBN pursues a more stringent regulatory framework to stabilize the financial system, banks are under increased pressure to demonstrate resilience and compliance. Zenith Bank’s transparency and swift action may help buffer market anxieties and reinforce its image as one of the sector’s more stable players. The coming weeks will be crucial, with June 30 serving as a key milestone for the bank’s efforts to fully exit forbearance status and restore normal shareholder returns.