By John Umeh
The Central Bank of Nigeria (CBN) has confirmed that 14 banks have successfully met the new capital requirements introduced under its ongoing recapitalisation exercise. Governor Yemi Cardoso made this known while presenting the communiqué of the Monetary Policy Committee’s (MPC) 302nd meeting held in Abuja.
The recapitalisation drive, which sets fresh benchmarks depending on licence categories, demands ₦500 billion from commercial banks with international authorisation, ₦200 billion for those with national authorisation, and ₦50 billion for regional players. Merchant banks are required to hold ₦50 billion, while non-interest banks are expected to maintain ₦20 billion (national) and ₦10 billion (regional).
This milestone marks the first significant banking recapitalisation since 2004, when the CBN raised the minimum capital base from ₦2 billion to ₦25 billion, forcing a wave of mergers and acquisitions that reshaped the industry.
Interest Rate Cut Signals Policy Shift
Alongside the update, the apex bank announced a reduction of the Monetary Policy Rate (MPR) by 50 basis points, from 27.5% to 27%. Cardoso explained that the decision was informed by five consecutive months of disinflation, projections of easing inflation for the rest of 2025, and the need to stimulate growth.
The CBN also adjusted the Cash Reserve Ratio (CRR) for commercial banks from 50% to 45%, retained merchant banks’ CRR at 16%, and kept the Liquidity Ratio steady at 30%. A new 75% CRR on non-Treasury Single Account public sector deposits was also introduced to manage excess liquidity.
Stronger External Position
Nigeria’s external reserves have strengthened, hitting $43.05 billion as of September 11, 2025, up from $40.51 billion at the end of July. This represents an import cover of over eight months. The current account balance also recorded a surplus of $5.28 billion in Q2 2025, nearly double that of the previous quarter.
Mixed Reactions from Stakeholders
The Nigeria Employers’ Consultative Association (NECA) welcomed the rate cut, describing it as a modest but necessary step to ease financing costs and boost growth. However, it warned that unless lower credit costs translate into real sector benefits, the impact on households and businesses may remain muted.
Similarly, the Centre for the Promotion of Private Enterprise (CPPE) hailed the policy as a timely intervention, while cautioning that liquidity risks must be managed to safeguard price stability. The Association of Small Business Owners of Nigeria (ASBON) described the move as encouraging but stressed that real relief for businesses would only come if the CBN sustains a downward trend in rates.
Analysts remain cautiously optimistic, with some noting that while the policy shift could drive growth, challenges such as insecurity and volatile global markets may threaten sustainability.
