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ARTICLE · 02 MAY 2024

Flashnotes - Issue 16 - 24 April 2024

KPMG in Nigeria
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Several options are available to banks in their effort to raise additional capital, a route we anticipate to be the first line of action for most banks in achieving

NigeriaFinance and Banking
Segun Sowande
Segun Sowande
Wole Adelokun
Wole Adelokun
Dolapo Adeosun
Dolapo Adeosun
Kalu Eke
Kalu Eke
Festus Ogunbayo
Festus Ogunbayo
Fatai Shuaib
Fatai Shuaib
Jessica Ezigbo
Jessica Ezigbo

CBN Bank recapitalisation

Highlights

  • We anticipate that the move by the CBN will enhance the stability and capacity of the banking industry as well as attract greater investments to the sector.
  • The new capital requirement as defined by the CBN has triggered a call to action by ALL banks who are impacted to different degrees.
  • Data suggests a significant capital shortfall of N4.2 trillion across all license categories, with available options for banks including capital raise (as much as between 35% - 90% of the new minimum capital); mergers and/or acquisitions; and the downgrade of license authorisations.
  • We recommend a proactive monitoring of market dynamics to identify and address any systemic risks or disruptions that may arise during the recapitalisation phase to preserve the stability of the financial system.

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