Stren & Blan Partners Industry Alert
On March 2
8, 2024, the Central Bank of Nigeria (“CBN”) issued a circular FPR/DIR/PUB/CIR/002/009 on the review of the minimum capital requirements for commercial, merchants, and non-interest banks (“Banks”). This review comes in response to prevailing macroeconomic challenges and the need to enhance banks’ resilience, solvency, and capacity to support the Nigerian economy.

New Minimum Capital Requirements

1. Commercial Banks: International (N500 billion), National (N200 billion), and Regional (N50 billion)
2. Merchant Banks: National (N50 billion)
3. Non-Interest Banks: National (N20 billion) and Regional (N10 billion)

The table below provides a clear comparison between the old and new minimum capital requirements for each bank category:


Minimum Capital (Old)

Minimum Capital (new)


Increase in %

Commercial Banks

50 (International)

25 (National)

10 (Regional)










Merchant Banks





Non-Interest Banks

10 (National)

5 (Regional)







As the table shows, the new requirements represent a substantial increase compared to the previous levels, and inother to meet this revised capital requirement, the CBN has given banks a 24-month time frame starting from April 1, 2024, to March 31, 2026. The CBN has also provided for various options in which banks can achieve the new minimum capital requirement including:

Injecting fresh equity capital through private placements, rights issues, or subscriptions.
Engaging in mergers and acquisitions (M&As).
Upgrading or downgrading their license authorization.

All banks, existing and new applicants, are expected to submit an implementation plan to the Director Banking Supervision Department, CBN by April 30, 2024. This plan should detail the chosen options and timelines for achieving the new capital requirements.

It’s also important to note that for existing banks, theminimum capital requirement shall comprise paid-up capital and share premium only, which shall not be based on shareholders fund, and Additional Tier 1 (AT1) Capital shall not be eligible for meeting the new requirement. Notwithstanding the capital increase, banks are to ensure strict compliance with the minimum capital adequacy ratio (CAR)requirement applicable to their license authorization.Banks that breach the Capital Adequacy Ratio (CAR) requirement shall be required to inject fresh capital to regularize their position.

However, for new banks seeking licenses, the minimum capital requirement shall be paid-up capital only This requirement applies to all new banking license applications submitted after April 1, 2024. The CBN will also continue to process pending applications for banking licenses, with promoters required to make up the difference between the capital deposited and the new capital requirement by March 31, 2026.

Protection of Depositors

During the period of the implementation of this new minimum capital requirement, the CBN will work closely with the Nigeria Deposit Insurance Corporation (NDIC) to ensure the protection of depositors’ interests. This collaboration is crucial in maintaining confidence in the banking system and safeguarding the funds of depositors.

Implications for Banks

Strengthened Capital Base: Banks will need to raise additional capital, which could lead to improved capital adequacy ratios and stronger financial positions.
Operational Adjustments: Banks may need to restructure their operations to accommodate the increased capital requirements, which could impact profitability and efficiency.
Access to Credit: There is a possibility that banks may become more cautious in lending, as they strive to meet the new capital requirements, potentially affecting access to credit for businesses and individuals.

Implications for the Economy

Improved Financial Stability: A stronger banking sector with higher capital requirements could contribute to overall financial stability in the economy.
Increased Investor Confidence: The higher capital requirements may boost investor confidence in Nigerian banks, leading to increased investment in the economy.
Enhanced Competitiveness: The new requirements may spur competition among banks, leading to improved efficiency and innovation in the sector.
Potential Economic Growth: Strengthening the banking sector is crucial for economic growth, as banks play a key role in financing economic activities.


The CBN’s decision to raise the minimum capital requirements for banks highlights its commitment to ensuring a sound and stable banking system in Nigeria. While the new requirements may pose initial challenges for banks, they are crucial for enhancing the sector’s resilience and ability to support economic growth. By strengthening the banking sector, the CBN is laying a foundation for a more robust and sustainable financial system that can withstand future challenges and contribute to Nigeria’s overall economic development.