President Bola Ahmed Tinubu has urged Nigerian banks to reduce their reliance on government securities and increase lending to businesses, infrastructure and other productive sectors of the economy.

Tinubu made the call at the 19th Annual Banking and Finance Conference of the Chartered Institute of Bankers of Nigeria (CIBN) in Abuja.

The President, who was represented by the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, said the banking sector must help transform recent economic stability into stronger private-sector growth.

According to him, attractive returns on government securities had made lending to businesses less attractive to banks over the years.

He, however, said improving fiscal conditions should create more room for increased private-sector credit.

“So, from financing government, we need to move to financing growth,” Tinubu said.

Tinubu links recapitalisation to business lending

The President said stronger fiscal discipline would reduce pressure on government borrowing, while lower inflation could support reduced interest rates.

He explained that cheaper capital would encourage investment, production, job creation and higher incomes.

Tinubu also said the recently completed bank recapitalisation must go beyond strengthening banks’ balance sheets.

He stressed that the additional capital should translate into increased financing for Nigerian businesses and support their expansion across Africa.

“A bigger bank that does not finance a more productive economy is a sub-optimal outcome,” he said.

To encourage lending to productive sectors, Tinubu said the Federal Government was expanding guarantees, risk-sharing arrangements, blended finance and credit enhancements.

He identified the National Credit Guarantee Company as central to the strategy.

According to him, the measures would reduce lending risks and attract more private capital into productive investments rather than relying mainly on direct government funding.

President wants more long-term capital for infrastructure

Tinubu also called for increased mobilisation of long-term capital for infrastructure, industry, housing and energy.

He said Nigeria could not finance long-term development primarily with short-term funds.

The President urged deeper capital markets and stronger pension, insurance and asset-management sectors to mobilise domestic savings and foreign capital for long-term investment.

He added that Nigeria must compete aggressively for international capital because investors are primarily attracted by risk-adjusted returns.

“Capital is highly mobile. It is neither emotional nor patriotic; it goes where risk-adjusted returns are attractive and competitive,” he said.

Tinubu further said Nigeria was expected to return to the JPMorgan Bond Index soon, while the country’s capital market had recorded about 60 per cent year-to-date growth.

He said the developments reflected improving investor confidence and provided an opportunity to attract more capital for productive investment.

Tinubu identifies five priorities for financial sector

The President identified five priorities for building a resilient financial system: growth facilitation, inclusion, technology, long-term capital and trust.

On financial inclusion, he said having a bank account alone was not sufficient.

He argued that genuine inclusion should enable market women and young entrepreneurs to access affordable working capital based on viable cash flow rather than collateral they may not have.

On technology, Tinubu said artificial intelligence, open banking, digital identity and instant payments were transforming financial services.

He, however, warned that rapid digital expansion was also creating new vulnerabilities.

“Cybersecurity is now financial stability infrastructure,” he said, while calling for stronger data protection and fraud prevention.

Banks urged to support Nigerian businesses across Africa

Tinubu also urged banks to help Nigerian businesses become regional champions by financing exports and expansion through the African Continental Free Trade Area (AfCFTA).

He said the continental market, with more than 1.4 billion people, presented significant opportunities for Nigerian businesses.

The President urged banks to help transform micro-enterprises into large companies while redirecting capital from speculation towards production.

CBN says economic stability is returning

The Governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, represented by the Deputy Governor, Economic Policy, Philip Ikeazor, said Nigeria’s macroeconomic stability was gradually returning.

He said monetary and fiscal authorities were working more closely together but acknowledged concerns about when ordinary Nigerians would begin to feel the impact of the improving indicators.

According to him, the benefits were expected to reach Nigerians as the collaboration between both authorities continued.

Cardoso said the authorities were working towards bringing inflation permanently into single digits and were engaging state governments because subnational governments also contribute to inflationary pressures.

He also credited banks for accepting the burden associated with the CBN’s cash reserve requirement as part of efforts to restore economic stability.

The CBN governor said the apex bank had incurred substantial costs in managing liquidity, while banks and fiscal authorities had also faced the effects of tighter monetary conditions.

He added that Nigeria’s economic buffers had been tested by external shocks, including the Iran conflict, but remained sufficient to withstand the disruption.

CIBN proposes SME hubs nationwide

The President of CIBN, Dele Alabi, called for the establishment of scalable SME Hubs across Nigeria to connect small businesses with infrastructure, skills, technology, markets and finance.

Alabi said many micro, small and medium enterprises remained constrained by high operating costs, inadequate infrastructure, limited market access, low productivity and insufficient digital adoption.

He said the proposed hubs could reduce operating costs, improve the bankability of small businesses and create a stronger link between recapitalised banks and the real sector.

Alabi said the initiative formed part of the Institute’s IMPACT Vision, introduced after he became the 24th President and Chairman of Council in May.

He said the vision was designed to move CIBN from identifying industry problems to developing practical solutions focused on professional standards, capacity building and responsible innovation.

Alabi also warned that artificial intelligence and fintech were creating both opportunities and risks for the financial system, including cyber threats, data governance concerns, market concentration, job displacement and systemic risks.

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United Bank for Africa (UBA) Plc has appointed veteran banker and corporate executive Emmanuel Nnorom as its new Group Chairman, following the retirement of Tony Elumelu after the completion of his tenure.

Nnorom, who has served as a Non-Executive Director on UBA’s Board since 2024, will officially assume office on August 21, 2026, in line with the Central Bank of Nigeria’s corporate governance guidelines.

Here are 10 key facts about the incoming UBA chairman:

1. Born in 1958
Emmanuel Nwabuikwu “Emma” Nnorom was born on April 7, 1958, and has built a distinguished career spanning banking, investment and corporate leadership.

2. Executive education at Oxford
Nnorom attended Templeton College, Oxford, where he completed executive leadership and management programmes, further strengthening his corporate governance expertise.

3. Chartered accountant and banker
He is a Fellow of the Institute of Chartered Accountants of Nigeria (ICAN) and an Honorary Member of the Chartered Institute of Bankers of Nigeria (CIBN).

4. More than 40 years of experience
With over four decades in banking, finance, audit, operations and corporate governance, Nnorom has occupied several executive and board positions in Nigeria’s financial sector.

5. Career across leading Nigerian banks
Before his leadership roles at UBA, he worked in senior management positions at Standard Trust Bank (now UBA), Diamond Bank, NUB International Bank and Liberty Merchant Bank, overseeing finance, operations, risk management, planning, information technology and human resources.

6. Rose through the ranks at UBA
Nnorom spent more than eight years in executive management at UBA, serving as Group Chief Operating Officer, Executive Director (Finance), Executive Director (Risk), Executive Director (Group Executive Office) and later Managing Director/Chief Executive Officer of UBA Africa.

7. Led UBA’s African expansion
As CEO of UBA Africa in 2013, he supervised the bank’s operations across several African countries, helping strengthen its position as one of the continent’s leading financial institutions.

8. Served at Heirs Holdings
Before joining Transcorp, Nnorom was President and Chief Operating Officer of Heirs Holdings between January and August 2014, where he played a key role in executing the group’s investment strategy.

9. Former President and CEO of Transcorp
Between September 2014 and May 2017, he served as President and Chief Executive Officer of Transnational Corporation Plc (Transcorp), overseeing businesses in power, hospitality, agriculture and energy.

10. Current Group CEO of Heirs Holdings
Since June 2017, Nnorom has served as Group Chief Executive Officer of Heirs Holdings, leading investments across financial services, healthcare, power, hospitality, real estate, technology and energy.

His appointment marks a new chapter for UBA as the bank transitions from the era of Tony Elumelu to another seasoned corporate leader with decades of experience in banking, governance and strategic investment.

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Abbey Mortgage Bank Plc has announced a N1.2 billion dividend payout, translating to 12 kobo per ordinary share of 50 kobo each, in a move that underscores its commitment to sustainable growth and shareholder value creation.

The announcement was made during the bank’s 34th Annual General Meeting (AGM), which brought together shareholders, board members, management, regulators, and other key stakeholders to review its financial performance and strategic direction.

At the meeting, shareholders approved key resolutions, including an additional capital raise and the dividend declaration, while commending the bank’s operational resilience and steady transformation within Nigeria’s financial services sector.

Managing Director and Chief Executive Officer of Abbey Mortgage Bank, Mobolaji Adewumi, said the institution remains focused on enhancing value delivery to shareholders while maintaining a balance between rewarding investors and strengthening long-term growth.

He said the bank’s next phase of growth will prioritise digitally driven banking services aimed at removing traditional barriers to financial access and improving customer experience.

“Our next phase is centered on delivering seamless and digitally driven banking experiences that eliminates the traditional barriers to premier financial services,” Adewumi said.

He added that the bank is working to build a resilient and agile institution capable of delivering meaningful value to all stakeholders.

Adewumi also highlighted the bank’s commitment to strong corporate governance, innovation, and expansion within Nigeria’s financial services industry.

The AGM also provided an opportunity for management to appreciate shareholders for their continued confidence and support, which the bank described as critical to its growth trajectory.

Abbey Mortgage Bank reaffirmed its focus on financial inclusion, innovation, and sustainable value creation as it continues to strengthen its position in the Nigerian banking sector.

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Abbey Mortgage Bank Plc is seeking shareholders’ approval to raise up to N164.5 billion through a combination of equity and debt instruments as part of its expansion and restructuring plans.

The proposal is contained in the notice for the bank’s 34th Annual General Meeting scheduled to hold virtually on May 25, 2026.

According to the notice filed with the Nigerian Exchange Limited, shareholders will consider resolutions covering fresh capital raising, debt issuance, and broader corporate restructuring initiatives.

Bank Plans N64.55bn Equity Raise

According to the AGM notice signed by Company Secretary Geoff O. Amaghereonu, the bank intends to raise approximately N64.55 billion through a private placement of 26.56 billion ordinary shares priced at N2.43 per share.

If approved and completed, the exercise would significantly increase the bank’s issued share capital from about N5.08 billion to approximately N18.36 billion.

The proposed shares will rank equally with existing shares in all respects.

Abbey Mortgage Targets N100bn Debt Programme

In addition to the equity raise, the bank is also seeking approval for a N100 billion debt issuance programme.

The programme may include several instruments such as:

• Senior unsecured or secured notes
• Subordinated debt
• Convertible securities
• Commercial papers
• Medium-term notes
• Bonds

The bank said the fundraising would be executed in tranches and subject to approvals from the Central Bank of Nigeria, the Securities and Exchange Commission, and the Nigerian Exchange Limited.

Capital Raise To Support Expansion

According to the bank, the capital raise forms part of a broader restructuring strategy aimed at strengthening capital adequacy, improving operational efficiency, and supporting long-term growth.

The lender stated that the fresh funding would help refinance existing obligations, expand its loan portfolio, and improve resilience within Nigeria’s evolving financial services sector.

“This will support the bank’s ability to meet minimum capital thresholds while ensuring continued compliance with industry regulations and sustaining business continuity,” the notice stated.

Shareholders To Receive Dividend

Shareholders will also consider approval for a dividend payment of 12 kobo per 50 kobo ordinary share for the 2025 financial year.

If approved, payment will be made on May 25, 2026, to shareholders whose names appeared in the register as of May 12, 2026.

The proposed dividend represents a 100 per cent increase from the 6 kobo dividend paid in 2024.

Profit Rises By 154%

In its audited 2025 financial results, Abbey Mortgage Bank reported a pre-tax profit of N3.12 billion, representing a 154.32 per cent increase compared to N1.22 billion recorded in 2024.

Post-tax profit rose to N2.16 billion, while interest income increased from N11.95 billion in 2024 to N18.97 billion in 2025.

The bank’s earnings per share also improved to 21 kobo from 11 kobo in the previous year.

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Abbey Mortgage Bank has reported a strong financial performance for the 2025 fiscal year, posting a profit before tax of N3.1 billion, representing a significant 154.32 percent increase compared to N1.2 billion recorded in 2024.

The bank’s audited financial statements highlight a year of accelerated growth, driven by rising interest income, improved operational efficiency, and expanding asset base.

Interest Income Drives Revenue Growth

The lender recorded total interest income of N18.9 billion, marking a 58.71 percent increase from N11.95 billion in the previous year.

A breakdown of the figures shows that earnings were largely supported by cash and short-term funds, which contributed N14.2 billion. Additional income came from investment securities valued at N2.5 billion and loans generating N2.1 billion.

Despite the strong revenue growth, interest expenses also rose significantly to N13.8 billion from N8.5 billion, primarily due to increased obligations to customers.

However, the bank still achieved a net interest income of N5.08 billion, up by 49.81 percent year-on-year.

Profitability Strengthens Across Key Metrics

The improved top-line performance translated into stronger profitability metrics across the board.

Net operating income rose to N6.16 billion, reflecting a 62.66 percent increase from N3.79 billion recorded in 2024. This growth was supported by non-interest income streams, including fees and commissions of N766.8 million and other income of N297.5 million.

After accounting for minimal impairment charges of N15.2 million, the bank maintained strong earnings momentum.

Operating expenses increased moderately to N3.04 billion, driven largely by personnel costs and depreciation. Despite this, profit before tax surged to N3.12 billion.

Following a tax expense of N960.5 million, profit after tax settled at N2.16 billion, more than double the N1.06 billion reported in the previous year.

Earnings Per Share Improves

Shareholders also benefited from the improved financial performance, with earnings per share (EPS) rising to 21 kobo, up from 11 kobo in 2024.

This reflects enhanced value creation for investors and improved profitability per unit of shareholding.

Balance Sheet Expands Significantly

The bank’s balance sheet showed strong expansion, with total assets growing to N165.8 billion from N84.2 billion.

Financial investments accounted for 64.8 percent of the total asset base, indicating a strategic focus on income-generating instruments.

Total liabilities increased to N155 billion from N75 billion, largely driven by customer deposits, which stood at N79.6 billion.

On the equity side, shareholders’ funds rose to N10.78 billion, supported by retained earnings of N2.4 billion.

Market Reaction and Investor Outlook

As of April 1, 2026, the bank’s share price had yet to react significantly to the release of its audited financial results.

However, market performance has remained strong, with the stock delivering over 54 percent returns year-to-date, reflecting sustained investor interest.

Analysts suggest that the impressive financial results could trigger further positive sentiment in the market, particularly if the bank maintains its growth trajectory.

Outlook

With rising interest income, improved profitability, and a strengthened balance sheet, Abbey Mortgage Bank appears well-positioned for continued growth.

The bank’s performance underscores its growing relevance within Nigeria’s financial sector, particularly in the mortgage and housing finance space.

Sustaining this momentum will depend on managing rising costs, optimizing asset allocation, and leveraging opportunities in Nigeria’s evolving real estate market.

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The Central Bank of Nigeria (CBN) has announced that 33 Nigerian banks have successfully met the new minimum capital requirements under its recently concluded recapitalisation programme.

The development marks a significant milestone in the regulator’s ongoing efforts to strengthen Nigeria’s banking sector, improve financial stability, and position lenders to better support economic growth.

N4.66 Trillion Raised in 24-Month Exercise

According to the apex bank, the recapitalisation exercise, which lasted 24 months, led to the mobilisation of approximately N4.66 trillion in fresh capital across the banking industry.

The CBN noted that this capital injection has significantly improved the financial health of banks, with capital adequacy ratios now exceeding global regulatory benchmarks.

Specifically, the regulator stated that most Nigerian banks now operate above the standards set under Basel Committee on Banking Supervision frameworks, indicating stronger resilience against financial shocks.

Strong Local Investor Participation

One of the key highlights of the recapitalisation programme is the high level of domestic participation.

Data from the CBN shows that about 72.55 percent of the total capital raised came from Nigerian investors. This reflects growing confidence in the country’s banking sector despite macroeconomic challenges.

Analysts say this trend signals renewed trust in financial institutions and a willingness by local investors to support long-term banking reforms.

Minimal Disruption to Banking Operations

The apex bank also confirmed that the recapitalisation process was implemented without major disruptions to banking services.

This ensured that customers continued to access financial services seamlessly throughout the exercise, while banks adjusted their capital structures to meet regulatory requirements.

However, the CBN disclosed that a small number of financial institutions are still undergoing regulatory and judicial review. These cases are being handled within established supervisory frameworks.

Strengthening Financial System Stability

The recapitalisation initiative is part of broader efforts by the CBN to fortify Nigeria’s financial system against both domestic and global economic pressures.

By increasing banks’ capital base, the regulator aims to enhance their ability to absorb losses, manage risks, and extend credit to key sectors of the economy.

Experts believe that a stronger banking system will play a critical role in driving investment, supporting businesses, and fostering economic recovery.

Implications for Nigeria’s Economy

With improved capital buffers, Nigerian banks are now better positioned to finance large-scale infrastructure projects, support small and medium-sized enterprises, and expand lending activities.

The recapitalisation is also expected to boost investor confidence, attract foreign investment, and enhance the overall competitiveness of Nigeria’s financial sector.

Market observers note that the success of the exercise could pave the way for further reforms aimed at deepening financial inclusion and improving regulatory oversight.

What Comes Next

While the completion of the recapitalisation programme marks a major achievement, attention is now shifting to how effectively banks deploy the newly raised capital.

The CBN is expected to maintain strict supervision to ensure that financial institutions adhere to prudential guidelines and utilize funds to support real sector growth.

As Nigeria navigates a complex economic landscape, stakeholders say the strengthened banking sector will be crucial in sustaining stability and driving long-term development.

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The (CBN) has directed commercial banks across to impose strict restrictions on major loan defaulters in a move aimed at strengthening financial system stability.

According to the apex bank, borrowers classified as “large-ticket obligors” with non-performing loans will no longer be allowed to access additional credit facilities or certain banking services.

Crackdown on High-Value Loan Defaulters

In a circular issued to financial institutions, the CBN explained that the directive targets borrowers whose unpaid debts pose potential risks to the banking sector.

Under the new policy, individuals or companies with large outstanding loans recorded in the Credit Risk Management System (CRMS) or other licensed credit bureaus will be barred from obtaining further loans or direct credit facilities.

The regulator said the measure forms part of its efforts to promote a stronger and more stable financial system while protecting depositors.

Restrictions on Key Banking Services

The circular also outlines several banking services that will be restricted for affected borrowers.

Banks are now prohibited from providing facilities such as:

• Letters of credit
• Performance bonds
• Bankers’ confirmations
• Advance payment guarantees
• Other contingent liabilities

Financial institutions have also been directed to request additional collateral from such borrowers to secure existing credit exposures.

Who the CBN Calls “Large-Ticket Obligors”

The CBN described large-ticket obligors as borrowers whose total debt exposure exceeds the Single Obligor Limit (SOL) under the country’s prudential banking guidelines.

These borrowers typically have loans that significantly affect a bank’s Capital Adequacy Ratio (CAR) or pose a broader systemic risk to the financial sector.

The apex bank noted that the directive reinforces an earlier policy introduced in 2014 aimed at preventing loan defaulters from accessing new credit facilities within the banking system.

Banks Warned Against Non-Compliance

The regulator warned that banks failing to comply with the directive would face sanctions under the .

It also confirmed that regulatory authorities will closely monitor compliance across the banking industry to ensure consistent enforcement.

Directive Comes Amid Bank Recapitalisation

The policy comes as Nigerian banks continue a major recapitalisation exercise introduced by the CBN in 2024 to strengthen the financial sector.

The programme is expected to be completed by March 31, with about 30 banks already meeting the new minimum capital requirements.

Analysts believe the new directive is part of broader efforts by regulators to reduce credit risk, improve lending discipline, and maintain financial stability within the banking sector.

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The Nigeria Deposit Insurance Corporation (NDIC) has assured depositors of Aso Savings and Loans Plc and Union Homes Savings and Loans Plc that they will receive insured deposits of up to N2 million per depositor.

The assurance followed the revocation of the operating licences of the two mortgage banks by the Central Bank of Nigeria (CBN).

In a statement issued on Tuesday, the NDIC said it had commenced the liquidation process for the affected institutions in line with the provisions of the NDIC Act 2023.

Earlier, the CBN announced the withdrawal of the licences as part of efforts to reposition the mortgage banking subsector and strengthen regulatory compliance.

According to the apex bank, the action was taken under Section 12 of the Banks and Other Financial Institutions Act (BOFIA) 2020 and Section 7.3 of the Revised Guidelines for Mortgage Banks in Nigeria.

The CBN cited several regulatory breaches by the banks, including failure to meet minimum paid-up share capital requirements, insufficient assets to cover liabilities, critical undercapitalisation, and non-compliance with regulatory directives.

Deposit Payment Process

The NDIC said depositors would be paid insured sums of up to N2 million, using their Bank Verification Number (BVN) to locate alternate bank accounts into which the funds would be credited.

Depositors with balances exceeding N2 million will receive the insured portion immediately, while the remaining balances will be paid later as liquidation dividends after asset sales and loan recoveries.

To facilitate this, the Corporation said it would begin the sale of the banks’ assets and intensify debt recovery efforts.

Claims and Verification

Depositors have been advised to submit claims through the NDIC online claims portal by completing a digital verification form.

Those who prefer physical verification can visit the nearest branches of the closed banks between December 16 and December 30, 2025, where NDIC officials will be available.

Required documents include proof of account ownership, a valid means of identification, BVN details, and information on an alternate bank account.

Creditors, Staff, and Shareholders

Creditors of the failed banks were also advised to submit claims within the verification period. Payment of liquidation dividends to creditors will begin after all depositors have been fully settled.

The NDIC added that staff of the defunct banks would be paid after depositors, while shareholders would receive payments only after further asset realisation and debt recovery.

Debtors of the closed banks were advised to contact the NDIC’s Asset Management Department to settle outstanding loan obligations.

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Nigeria’s banking sector is undergoing one of its most comprehensive reforms in decades, as deposit money banks move to raise an estimated ₦4.14 trillion in fresh capital ahead of the March 31, 2026 recapitalisation deadline, according to a report by global professional services firm, Deloitte.

The recapitalisation exercise, introduced by the Central Bank of Nigeria (CBN) in April 2024, is aimed at strengthening financial stability, improving resilience to macroeconomic shocks, and positioning the banking system to support Nigeria’s ambition of building a $1 trillion economy by 2030.

Under the new framework, the CBN significantly raised minimum capital requirements, setting thresholds at ₦500 billion for commercial banks with international licences, ₦200 billion for national banks, and ₦50 billion for regional banks.

Merchant banks are required to maintain ₦50 billion, while non-interest banks must hold between ₦10 billion and ₦20 billion, depending on licence scope.

Unlike previous recapitalisation exercises, the apex bank adopted a stricter definition of qualifying capital, limiting it to paid-up share capital and share premium, while excluding retained earnings and other reserves.

This change effectively compelled most banks to raise new funds, even those that previously appeared adequately capitalised.

Deloitte noted that the policy shift became necessary as banks’ capital buffers were eroded by prolonged macroeconomic pressures, including high inflation, rising interest rates, exchange rate volatility, and foreign exchange illiquidity.

The firm said the recapitalisation would enable Nigerian banks to take on larger risks, strengthen liquidity positions, and expand their capacity to absorb losses arising from domestic and external shocks.

Progress so far suggests the sector is responding positively. CBN Governor Olayemi Cardoso disclosed that 27 banks have raised capital through public offers and rights issues, with 16 banks already meeting or exceeding the new minimum capital requirements well ahead of the deadline.

Speaking at the recent Bankers’ Dinner in Lagos, Cardoso said the recapitalisation programme remains on track, noting that stress tests conducted during the year confirmed the sector’s resilience, with key financial soundness indicators remaining within regulatory benchmarks.

He added that, with months left to the deadline, several banks are well positioned to comply comfortably, while others are making steady progress.

To safeguard the trillions of naira being injected into the financial system, the CBN is redesigning its credit-risk framework, focusing on stronger governance, improved transparency, and firmer accountability. The objective, according to Cardoso, is to prevent the boom-and-bust cycles that followed past recapitalisation efforts.

As part of the reforms, the apex bank has established a dedicated Compliance Department to oversee financial crime supervision, market conduct, corporate governance, enterprise security, and Environmental, Social and Governance (ESG) compliance.

In addition, the Credit Risk Management System (CRMS) has been upgraded and web-enabled, allowing banks to submit statutory returns and conduct real-time borrower checks, with plans underway to integrate the platform more closely with banks’ internal systems.

At its 303rd Monetary Policy Committee (MPC) meeting, the CBN-led committee expressed satisfaction with the banking system’s resilience and urged the apex bank to ensure a smooth conclusion of the recapitalisation process.

Beyond financial stability, regulators view the exercise as critical to Nigeria’s long-term growth strategy. Cardoso said the current capital base of Nigerian banks would be insufficient to finance a $1 trillion economy without decisive reforms.

CBN Deputy Governor Emem Usoro described recapitalisation as a key pillar of national economic planning, while UBA Group Managing Director, Oliver Alawuba, said the policy would strengthen banks’ ability to withstand shocks and fund long-term development.

Despite the higher capital thresholds, the CBN has reassured the public that the sector remains stable, noting that the non-performing loan ratio is within the five per cent prudential limit and liquidity ratios remain above regulatory minimums.

Analysts say the success of the recapitalisation programme will be critical in determining not only the future strength of Nigeria’s banking sector but also its capacity to drive sustainable economic growth in the coming years.

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Nigerian banks are tightening their lending standards as land and buildings—once considered the most reliable form of loan security—are now being classified as high-risk collateral.

The shift follows widespread demolitions, title revocations, and increased regulatory enforcement across several states, raising concerns about the stability of property-backed lending in the country.

For decades, lenders relied heavily on property documentation such as Certificates of Occupancy (C of O) and approved building plans as solid assurance for loan recovery. But recent events have exposed deep structural and regulatory vulnerabilities in the real estate ecosystem.

Industry analysts warn that the uncertainty surrounding property titles, coupled with stricter enforcement of urban planning laws, has created a level of unpredictability that now undermines the acceptability of real estate as collateral.

Title Problems and Regulatory Risks Fuel Bank Concerns

Experts estimate that nearly 70% of properties in Nigeria carry incomplete, disputed, or unverifiable documentation, making it increasingly difficult for banks to establish clear legal ownership. Without certainty, lenders cannot guarantee the recovery of assets when borrowers default.

Even when titles appear valid, many properties fail to meet building-permit or urban-planning standards. The spate of demolitions—often linked to unauthorized developments—has resulted in sudden loss of collateral value for both borrowers and lenders.

Financial institutions say this instability has raised major red flags about legal and regulatory exposure.

Valuation Gaps Complicate Lending

Banks and estate surveyors also report significant discrepancies between market valuations and the more conservative assessments applied by lenders. These gaps reduce the loan-to-value ratios banks are willing to approve, limiting how much credit borrowers can access.

Real estate liquidity is another challenge. In certain locations, properties take extended periods to sell, making recovery in default situations both slow and uncertain.

Impact on Borrowers and the Real Estate Market

The shift has wide-ranging implications for Nigeria’s credit ecosystem:

Tighter lending conditions: Banks are reducing exposure to property-backed loans and increasingly demanding additional collateral.

Mortgage bottlenecks: Access to home loans may decline, affecting middle-income Nigerians and slowing homeownership growth.

Shift toward alternative collateral: Lenders are exploring income-based lending and movable-asset financing to sustain credit flow.

Developer financing constraints: Real estate developers may face tougher loan approval processes, slowing project delivery.

Experts Call for Urgent Reforms

Stakeholders agree that restoring confidence in real estate as collateral will require sweeping reforms, including:

• comprehensive land registration and documentation,
• unified title verification systems,
• stricter enforcement of planning approvals,
• and improved valuation standards.

They warn that without meaningful reforms, the real estate sector’s potential to support Nigeria’s housing finance system and broader economic development will remain severely constrained.

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