- Fitch Ratings says Nigerian banks are on track to meet the 2026 Central Bank of Nigeria’s recapitalisation deadline
- It said the banks have made significant progress
- The rating agency outlined the performance of banks in different tiers
International rating agency, Fitch Ratings, says Nigerian banks are on track to meet the March 2026 recapitalisation deadline set by the Central Bank of Nigeria (CBN).
Fitch disclosed this in a non-rating commentary issued by the firm on Nigerian banks on Wednesday, February 12, via its website.
Recall that in March 2024, the CBN issued guidelines on banks’ new minimum capital requirements which can be achieved through equity injections, mergers and/or acquisitions, or licence upgrades or downgrades.
The policy requires commercial banks with international licences to maintain a minimum capital of N500 billion, national commercial banks require N200 billion, while the threshold for regional commercial and merchant banks is N50 billion.
In the commentary, Fitch stated that Fitch-rated banks have made significant progress toward meeting their capital requirements, as almost all have raised capital or formally launched the process to do so.
Fitch added that the bank recapitalisation move will provide businesses with the fuel for growth.
“Nigerian banks are making significant progress in raising core capital to meet new paid-in capital requirements and are generally on track to meet the end-1Q26 deadline.
“This is supporting a recovery in capitalisation from the impact of the naira devaluation, providing fuel for business growth. It also reduces the likelihood of significant banking sector consolidation,” it stated.
Banks’ capital-raising performance
The rating agency also analysed the performance of banks toward raising capital to meet the minimum base for their licence categories.
Fitch noted that mergers and acquisitions, as well as licence downgrades, would likely be seen among third-tier banks.
It said, “The two largest banks, Access Holdings and Zenith Bank, are the first to secure enough fresh capital to meet the N500 billion requirement for an international licence. First HoldCo, United Bank for Africa, and Guaranty Trust Holding Company are taking a phased approach. They have recently raised capital and have shareholder approval to raise more to meet the N500 billion requirement.
“First HoldCo’s and United Bank for Africa’s recent rights issues are awaiting final regulatory approval. Fidelity Bank and FCMB Group have completed initial capital raisings but will need to raise more to maintain their international licences.
“As second-tier banks, they must raise significantly more capital relative to their balance sheets than larger banks. They have extraordinary general meeting approval for this, although they could consider downgrading to a national licence as each has just one foreign subsidiary.
“We estimate that ENG is still in breach of its total capital adequacy ratio requirement of 10 per cent, but it has further capital-raising plans to restore compliance. Stanbic IBTC Holdings has launched a rights issue to raise capital to maintain its national licence.”
It maintained that strong investor appetite has ensured the vast majority of capital raisings so far have been successful, and most first- and second-tier banks should be able to meet their new capital requirements through capital raisings alone.
“Therefore, we believe the likelihood of banking sector consolidation among first- and second-tier banks has decreased,” it noted.
Fitch added that the Union Bank of Nigeria, which is also in breach of its 10 per cent Capital Adequacy Ratio (CAR) requirement, and third-tier banks have generally been slower to raise capital.
It said Wema Bank has shareholder approval to raise enough capital to retain its national licence, which it plans to launch in April, while Coronation Merchant Bank recently received board approval.
CBN’s recapitalisation policy has got banks running helter-skelter for funds
Meanwhile, TheRadar earlier reported that Deposit money banks (DMBs) in Nigeria have been on their toes and busy making efforts toward meeting the new recapitalisation policy of the Central Bank of Nigeria (CBN).
Since the announcement, Nigerian banks have not rested on their oars as they have been scampering for funds through many capital-raising activities.
