Nigeria Leads Sub-Saharan Africa’s Banking Recapitalisation Drive - Fitch Ratings

Nigeria is taking the lead in strengthening its banking sector in Sub-Saharan Africa, according to a new report by Fitch Ratings. While many African countries are improving their banking rules after the COVID-19 pandemic, Nigeria’s plan stands out because of how big and fast the changes are, and how much they are expected to transform the industry.

The Central Bank of Nigeria (CBN) recently announced a major increase in the minimum capital banks must have. Banks with international licences must now hold at least ₦500 billion, up from ₦50 billion, while banks with national licences must raise their capital to ₦200 billion, up from ₦25 billion. This makes Nigeria’s new rules the highest in the region and shows the country’s strong push to build a safer, stronger, and more reliable banking system.

Fitch noted that unlike countries such as Kenya, Burundi, and Sierra Leone , where banks are allowed to use money they already have in their reserves , Nigeria has taken a tougher approach. The CBN has made it clear that banks must bring in fresh money from investors, merge with other banks, or reduce their licence category if they cannot meet the requirement. The deadline for banks to meet these new standards is the first quarter of 2026, which is much earlier than other African countries that have until 2029.

This move is expected to make Nigerian banks more stable and able to survive economic challenges like currency changes and inflation. It also means banks will have more power to support businesses, fund big projects, and help grow the economy. Even though some banks may need to merge or change their structure, experts believe this will lead to a stronger banking industry overall.

Many analysts see this reform as a bold and necessary step. It reminds people of the major banking reforms in 2004 that reshaped Nigeria’s financial sector and created stronger banks. Once again, Nigeria is showing leadership in Africa by taking big decisions that prepare the country for the future. If the recapitalisation programme succeeds, it will build confidence among investors, strengthen the economy, and position Nigeria as a major financial force in the region.

In simple terms, Nigeria is raising the bar for its banks. The goal is to make sure they are strong enough to handle challenges and support the nation’s growth. It may be tough in the short term, but the long-term benefits could be huge, helping Nigeria move closer to achieving a more stable and prosperous economy.