Central Bank of Nigeria (CBN), Tuesday, said the banking industry – now with stronger balance sheets – must implement tighter risk management, sound governance, and responsible lending in the post-recapitalisation era.
CBN stated that bigger bank balance sheets alone will not guarantee resilience, which is key for stability.
CBN Deputy Governor, Corporate Services Department, Dr. Muhammad Sani Abdullahi, gave the charge in Abuja at the opening of the central bank’s 38th Annual Seminar for Finance Correspondents and Business Editors, with the theme, “Towards a Robust and Resilient Financial System in the Post-Banking Sector Recapitalisation Era.”
Abdullahi said CBN would continue to deepen its risk-based supervisory approach, macroprudential surveillance, and stress testing to safeguard the stability of the financial system.
CBN’s Director, Banking Supervision Department, Dr. OlubukolaAkinwunmi, for his part, made it clear that in the post-recapitalisation era, banks must follow the rules. Akinwunmi said profit-chasing will not excuse cutting corners, as enforcement tightens to keep the financial system strong.
He stressed that the regulator would insist on strict compliance with prudential requirements, adding that stronger capital buffers would be meaningless if banks continue to take excessive risks.
Still addressing the theme of the forum, Abdullahi said, “Our supervisory approach will continue to emphasise risk-based supervision, macroprudential surveillance and enhanced stress testing.”
He said financial sector coordination, consumer protection, fintech regulation, and support for responsible innovation would remain important, alongside crisis preparedness and resolution planning.
Abdullahi said, “As the governor has consistently emphasised, preserving monetary and financial stability requires continued vigilance.
“We must remain forward-looking, data-driven and responsive to developments at home and abroad.”
The CBN deputy governor said the recent recapitalisation had provided the banking industry with stronger capital to support a growing economy, but stressed that capital alone would not guarantee resilience.
According to him, “Capital, however, is a starting point. Boards and management must maintain sound controls, recognise risks early and lend on the strength of viable projects.”
By the end of the two-year recapitalisation programme announced in March 2024, Abdullahi disclosed that 33 banks had met the revised minimum capital requirements and raised N4.65 trillion.
He said Nigeria’s ambition of building a $1 trillion economy by 2030 required banks capable of mobilising and allocating capital on a much larger scale.
He stated, “Stronger capital buffers should enable banks to finance long-term infrastructure, support industrial expansion, facilitate international trade and compete more effectively in regional and global markets.
“They also provide greater capacity to absorb losses during economic stress and sustain investment in innovation and digital transformation.”
Abdullahi stressed that the stronger capital base must be underpinned by sound corporate governance.
He explained, “Sound corporate governance must underpin that work. Boards and management teams must demonstrate integrity, accountability and transparency, strengthen internal controls and guard against excessive risk-taking.
