Nigeria's banking industry is undergoing a significant transformation, with a major consolidation phase now in full swing. As the March 31, 2026 deadline for the Central Bank of Nigeria's (CBN) recapitalisation exercise approaches, 23 deposit money banks have successfully met the new capital requirements, while three other institutions are progressing towards mergers.
A Landmark Policy for Financial Resilience
This development represents a crucial milestone in the CBN's strategic plan to fortify the Nigerian financial system. The recapitalisation policy, introduced in 2024, was designed to enhance the banking sector's resilience, stability, and capacity to compete globally amidst increasing economic complexities. The policy established significantly higher minimum capital bases: N500 billion for commercial banks with international authorisation, N200 billion for national banks, and N50 billion for those operating regionally.
Non-interest banks were also included, with national operators required to raise N20 billion and regional ones N10 billion. The CBN provided a 24-month window for compliance, which triggered widespread capital raising activities, internal restructuring, and merger discussions across the sector. This exercise is reminiscent of the historic 2004 banking consolidation led by former CBN Governor, Professor Charles Soludo, which dramatically reduced the number of banks from 89 to 25.
Leading Banks Set the Pace in Capital Raises
As of mid-January 2026, data confirms that 23 banks have crossed the recapitalisation threshold. Access Bank emerged as a frontrunner, successfully raising N351 billion through a rights issue. This move bolstered its capital base to N602.8 billion, placing it comfortably above the CBN's minimum requirement for an international bank.
Zenith Bank followed closely behind, securing over N350 billion through a combination of rights issues and public offers. This effort pushed its total capital to approximately N614 billion. Furthermore, First Bank of Nigeria, a subsidiary of First Bank Holdings (First HoldCo), confirmed it has also achieved the N500 billion mark. The bank utilized a strategic mix of rights issues, private placements, and the divestment of its merchant banking arm to reach the target.
National and Non-Interest Banks Show Strong Compliance
The drive for compliance extended beyond the tier-1 lenders. Several national banks have also completed their recapitalisation journeys. Sterling Bank achieved its goal through targeted capital raises executed by its parent company, Sterling HoldCo, including a public offer that exceeded N88 billion. Wema Bank raised N150 billion via a rights issue.
International banks with Nigerian subsidiaries, such as Citibank Nigeria and Standard Chartered Nigeria, met their requirements with support from their global parent institutions. The non-interest banking segment demonstrated robust compliance as well. Key players including The Alternative Bank (AltBank), Jaiz Bank, TAJBank, and Lotus Bank have all successfully met their new capital benchmarks. AltBank secured its necessary capital injection as early as May 2025, positioning itself as a strong contender in the growing ethical finance space.
Mergers and Regulatory Warnings Shape the Final Phase
With the deadline looming, the CBN has issued clear warnings to banks that fail to comply. The regulator has indicated that non-compliant institutions may face licence downgrades or be compelled into mergers. CBN Governor, Olayemi Cardoso, has reiterated that the exercise is critical for long-term systemic resilience and remains firmly on track.
Industry reports, including an outlook from credit rating agency DataPro, project that at least three bank mergers will materialize in early 2026. These mergers are driven by the intense pressure to meet capital requirements and are expected to involve smaller lenders seeking strategic combinations to survive. This wave of consolidation is anticipated to reshape Nigeria's banking landscape, creating fewer but stronger financial institutions capable of funding large-scale economic growth and competing effectively on the international stage.
