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Top 5 banks in N1.5 trillion shortage due to CBN New Capital Base

shortage; The Central Bank of Nigeria, or CBN, set a new minimum capital foundation for international commercial banks yesterday. The top five banks are short of N1.5 trillion to meet this base.
The minimum capital base for commercial banks with international authorization was raised by 900 percent to N500 billion from N50 billion in a statement released by the CBN yesterday.

• National commercial banks receive N200 billion; international commercial banks receive N500 billion; banks have a 24-month deadline.

The Acting Director of the Corporate Communications Department, Mrs. Hakama Sidi Ali, confirmed this in an Abuja statement yesterday. She stated that the minimum capital base for commercial banks with national authorization has increased to N200 billion from N25 billion, a 700% rise.

Furthermore, she revealed that the new N50 billion requirement—a 400% increase from N10 billion—for commercial banks with regional authorization had been lifted.

Mrs. Sidi Ali also revealed that non-interest banks with national and regional authorizations would need to have N20 billion and N10 billion in capital, respectively, while merchant banks would need to have N50 billion.

Furthermore, banks must attain the capital threshold by March 31, 2026, starting April 1, 2024, as specified in the circular. Consequently, the directive seeks to strengthen banks for Nigeria’s growth, echoing Governor Cardoso’s statement at the 2023 Bankers’ Dinner.

Additionally, the minimum capital should consist solely of paid-up capital and share premium, excluding shareholders’ funds. Subsequently, banks must maintain the minimum capital adequacy ratio (CAR) and inject capital if they breach the CAR requirement. Moreover, proposed banks must meet the minimum capital requirement with paid-up capital for new license applications submitted after April 1, 2024.

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Additionally, pending applications with capital deposits or Approval-in-Principle (AIP) grants must meet the new capital requirement by March 31, 2026.

Moreover, banks must submit plans by April 30, 2024, detailing strategies and timelines for meeting the new capital requirement. Furthermore, the CBN will monitor and ensure compliance with the new regulations within the specified timeframe.

Leading banks and the lack of capital

Access Bank, FirstBank, GTBank, UBA, and Zenith Bank must each have a minimum capital base of N500 billion.

However, the CBN specifies that this requirement only applies to paid-up capital and share premium, thereby emphasizing its focus.

HYPEBLOG9JA MEDIA investigation, using latest financial reports, reveals the top five banks’ total paid-up capital and share premium.

This indicates a shortfall of N1.472 trillion.

Access Corporation, parent of Access Bank, reports N251.811 billion paid-up capital and share premium, resulting in a N248.189 billion shortfall.

FBN Holdings, parent of FirstBank, declares paid-up capital and share premium of N251.3 billion, resulting in a N248.66 billion shortfall.

GTHoldco, parent of GTBank, reveals paid-up capital and share premium of N138.186 billion, leading to a N361.814 billion shortage.

UBA reports paid-up capital and share premium of N115.815 billion, leading to a shortfall of N384.185 billion.

Zenith Bank discloses paid-up capital and share premium of N270.745 billion, resulting in a shortfall of N229.255 billion.



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