Uncertainty has lingered in Nigeria’s banking space following the completion of the recent recapitalisation exercise, with customers of a few affected institutions increasingly uneasy about the safety of their deposits. The concerns stem largely from ongoing legal and regulatory entanglements involving some banks, even as the broader reform has been declared a success.
In response, the Central Bank of Nigeria (CBN) has sought to reassure the public, insisting that the institutions under scrutiny remain financially sound and capable of meeting regulatory obligations. According to the apex bank, the challenges facing these lenders are procedural rather than fundamental, and do not threaten their operational stability.
At the centre of the situation are a handful of banks still navigating post-recapitalisation hurdles. The proposed merger between Providus Bank and Unity Bank—the only consolidation to emerge from the exercise—has yet to receive final legal endorsement, despite securing regulatory approvals. This delay has contributed to lingering doubts about the pace of finalising the sector’s restructuring.
Meanwhile, developments surrounding Union Bank of Nigeria have added another layer of complexity. A ruling by the Federal High Court in Lagos nullified the CBN’s earlier dissolution of the bank’s board and management, declaring the January 2024 intervention unlawful and reinstating the previous leadership. The apex bank has since escalated the matter, approaching the Court of Appeal to overturn the judgment, arguing that its actions were necessary to avert a broader systemic risk.
Other lenders, including Polaris Bank and Keystone Bank, remain under regulatory oversight and were not listed among those that met the new minimum capital threshold by the March 31, 2026 deadline. Despite this, the CBN maintains that both institutions possess the capacity to comply once ongoing issues are resolved.
Speaking during the sidelines of the World Bank/IMF Spring Meetings, CBN Governor Olayemi Cardoso emphasised that the affected banks should not be judged by the same timeline as others, noting that unforeseen complications had arisen after the recapitalisation policy was introduced over two years ago.
He expressed confidence that the remaining institutions would bridge their capital gaps in due course, stressing that their day-to-day operations remain unaffected. According to him, customers should have no immediate cause for concern, as normal banking activities continue uninterrupted across the system.
Beyond the isolated cases, Cardoso described the recapitalisation programme as a major milestone for Nigeria’s financial sector. He pointed to strong participation from both local and international investors—roughly 73 per cent domestic and 27 per cent foreign—as evidence of renewed confidence in the country’s banking industry.
The governor noted that initial scepticism surrounding the policy had largely dissipated, replaced by recognition of its success both at home and among international stakeholders. Feedback from global counterparts at the meetings, he added, has been largely positive, with many expressing surprise at the scale and effectiveness of the reform.
With most banks now meeting the revised capital requirements, the CBN insists that Nigeria’s banking sector has entered a more resilient phase. While a few institutions remain tied up in legal and regulatory processes, authorities maintain that their eventual compliance is only a matter of time, reinforcing the broader narrative that the recapitalisation drive has firmly repositioned the industry for long-term stability.