The Securities and Exchange Commission (SEC) has disclosed that Nigerian banks have raised approximately N1.7 trillion through electronic offerings (e-offerings) as part of their ongoing recapitalization efforts to meet the new minimum capital requirements set by the Central Bank of Nigeria (CBN).
The exercise is a critical component of broader financial reforms aimed at ensuring stability and fostering economic growth within the Nigerian financial system.
The e-offering system, which leverages digital platforms for seamless access to prospectuses, offering documents, and subscription payments, has been instrumental in facilitating this milestone.
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According to SEC Director-General Emomotimi Agama, the funds were raised through 12 applications from nine banks. The innovative approach significantly enhanced investor participation by simplifying the process and fostering transparency.
However, not all banks have achieved similar levels of success in their public offerings. While tier-1 and some tier-2 banks have recorded substantial gains, others have faced challenges in attracting investors. This uneven performance has been largely attributed to Nigeria’s current economic challenges, including high inflation, currency devaluation, and dwindling purchasing power, which have constrained the ability of individuals and businesses to invest in these offerings. The economic downturn has also affected investor confidence, impacting the recapitalization drive.
Despite these hurdles, financial regulators and market analysts remain optimistic. They believe the banks will successfully meet the recapitalization thresholds before the March 31, 2026, deadline.
The CBN’s revised guidelines mandate international commercial banks to maintain a capital base of N500 billion, while national and regional financial institutions are required to have N200 billion and N50 billion, respectively. For merchant banks, the minimum capital for national license holders is set at N50 billion, while non-interest banks require between N10 billion and N20 billion, depending on their operational scale.
The SEC’s initiatives to modernize and streamline the capital-raising process have been pivotal in supporting these efforts. The commission introduced electronic filing systems, reduced regulatory bottlenecks, and enhanced frameworks aimed at shortening the time to market for securities.
Agama noted that these reforms have significantly improved liquidity, bolstered investor confidence, and made the Nigerian capital market more competitive.
“The e-offering platform was pivotal in ensuring the success of the banks’ recapitalization exercise, enabling over N1.7 trillion to be raised,” he said.
“What you have seen so far is the use of technology to drive the market with more investors coming into the market.
“That tells you what technology can do. We are also exploring technology for other activities, such as, monitoring and surveillance and other processes that will bring about a cohesion of all the policies that SEC has applied to make the market grow bigger.”
Agama further highlighted the broader economic implications of these reforms. He stressed the importance of diversifying Nigeria’s economy beyond oil, advocating investments in infrastructure, human capital, and innovation to create a more robust economic framework. He also emphasized the need for financial inclusion and easier access to credit for small and medium enterprises (SMEs) as critical drivers of sustainable growth.
“A shorter time to market can benefit capital market development in several ways, such as increased liquidity; faster listing allows companies to access capital more quickly and increase liquidity in the market,” he said.
The recapitalization exercise aligns Bola Tinubu’s ambitious $1 trillion economic target. Agama expressed confidence in the capital market’s ability to provide the long-term funding necessary to achieve this goal. The SEC aims to strengthen the financial sector and position it as a catalyst for economic development by fostering a conducive environment for investment.
Financial analysts believe that the progress achieved thus far, driven by technological innovation and regulatory support, sets a positive trajectory for Nigeria’s banking sector as it works towards meeting the March 2026 deadline. While the recapitalization process progresses, the banks still face hurdles in raising the remaining N2.44 trillion.
If successful, the ongoing recapitalization that has been lauded by experts could serve as a model for other developing economies aiming to deepen their financial systems.