.Apex bank reduces interest rate from 27% to 26.50 %
By Yahaya Umar, Abuja
Ahead of Central Bank of Nigeria, CBN, March 31 recapitalisation exercise 20 Nigerian Banks have met the new minimum capital requirement.
Governor of the CBN, Dr. Yemi Cardoso, made this known yesterday in Abuja while presenting the communiqué from the 304th meeting of the apex bank’s Monetary Policy Committee, MPC.
It would be recalled that in March 2024, CBN announced a major bank recapitalisation programme requiring Nigerian banks to raise higher capital bases within 24 months.
This is to make the financial sector stronger, more resilient, and able to support economic growth.
The exercise began on April 1, 2024, and the deadline for full compliance is March 31, 2026.
Under the framework, banks must meet higher capital thresholds based on their licence type ; and capital must be in paid-up share capital and share premium only (not reserves or retained earnings).
Commercial banks with international licences are required to raise a minimum capital of N500 billion, commercial banks with national licences have N200 billion requirement, while those with regional licenses have N50 billion.
Merchant banks have a minimum capital requirement of N50 billion,
Non-interest banks with national licences have N20 billion, and non-interest banks with regional licence N10 billion.
According to Cardoso , with regards to the ongoing recapitalisation programme, of the 33 banks that have raised additional capital, 20 have met the new minimum capital requirement.
“This has reaffirmed steady progress towards a more robust and well-capitalised financial system.
“The MPC reiterated the strategic importance of the recapitalisation exercise and urged the CBN to ensure its successful completion.
“This would reinforce financial system resilience and enhance the sector’s capacity to support sustainable economic growth, price, and other domestic developments”, he said.
He said gross external reserves rose significantly to 50.45 billion dollars as of February 16, the highest in 13 years.
“This provides an import cover of 9.68 months for goods and services”, he said.
Meanwhile, the Central Bank of Nigeria’s Monetary Policy Committee, MPC, has reduced the Monetary Policy Rate, MPR, by 50 basis points to 26.50% from 27%, the CBN Governor, Yemi Cardoso, announced.
Cardoso made the disclosure yesterday at the 304th MPC meeting in Abuja.
The MPR serves as the baseline interest rate within the Nigerian economy.
He said the 11 MPC members present also voted to retain the Cash Reserve Ratio ,CRR, at 45% for commercial banks and 16% for merchant banks, maintaining current liquidity levels.
Cardoso added that the Liquidity Ratio remained at 30% while the Standing Facilities Corridor was retained at +50/-450 basis points around the MPR to guide market stability and financial operations.
