The Central Bank of Nigeria (CBN) has barred financially distressed banks benefiting from regulatory leniency from paying dividends or bonuses, in a move aimed at stabilising the sector ahead of the 2026 recapitalisation deadline.
- No Dividends, No Bonuses: Banks under regulatory forbearance cannot pay dividends or grant bonuses to executives.
- Why It Matters: The CBN is reviewing capital adequacy and credit exposure in light of ongoing banking reforms.
- Expansion on Hold: Affected banks are banned from launching offshore ventures or investing in foreign subsidiaries.
- Temporary but Strategic: The suspension will be lifted once banks meet prudential standards and exit forbearance.
The June 13 directive signed by the Director of Banking Supervision, Mrs Olubukola Akinwunmi, stresses the need to retain internal resources to meet obligations and rebuild sound financial health.
The move comes amid stricter regulation following the CBN’s recapitalisation deadline of March 2026 and Nigeria’s ambition to hit a $1 trillion GDP target. The CBN had earlier restricted banks from using FX revaluation gains to pay dividends.
With regulatory scrutiny tightening, distressed banks must clean up their books before rewarding shareholders or expanding operations.
