Billionaire investor Femi Otedola has called on Nigerian regulators to consider raising the minimum capital requirement for banks operating with international licences, arguing that the current threshold may fall short of the demands placed on globally active lenders.
The Chairman of First HoldCo Plc said the ₦500 billion minimum capital requirement introduced by the Central Bank of Nigeria marks a positive step, but does not fully reflect the scale and complexity of transactions expected of banks financing cross-border deals and critical sectors of the economy. He suggested that a ₦1 trillion capital floor would be a more realistic benchmark for institutions with international ambitions.
Otedola’s remarks come amid the ongoing banking sector recapitalisation programme launched by the CBN in 2024, the first major overhaul of capital requirements in nearly 20 years. Under the policy, banks with international licences are required to meet a ₦500 billion minimum capital base, while national and regional banks are subject to lower thresholds.
The recapitalisation drive is aimed at strengthening balance sheets, improving shock absorption, and restoring confidence in Nigeria’s financial system following years of macroeconomic volatility.
Otedola also linked stronger capital requirements to improved corporate governance, noting that larger equity bases tend to widen ownership structures and reduce the influence of dominant shareholders. According to him, better-capitalised banks are more likely to operate with stronger oversight and institutional discipline.
Industry analysts say higher capital thresholds could accelerate consolidation within the sector, deepen market discipline, and improve risk management practices across the banking landscape.
The comments followed confirmation that First Bank of Nigeria Limited, the commercial banking subsidiary of First HoldCo, has met the ₦500 billion minimum capital requirement. The group said the milestone was achieved through a combination of capital-raising initiatives and portfolio restructuring, positioning the bank to pursue growth opportunities under the new regulatory framework.
From a broader economic perspective, advocates of higher capital standards argue that Nigeria’s ambition to expand economic output and attract long-term investment requires banks with the capacity to finance large-scale infrastructure, energy, manufacturing, and trade transactions. Well-capitalised lenders, they say, are better placed to support long-term credit expansion without undermining financial stability.
The debate over capital adequacy is unfolding alongside wider economic reforms under President Bola Tinubu, with the CBN led by Governor Yemi Cardoso pursuing tighter monetary discipline, foreign exchange reforms, and measures aimed at rebuilding investor confidence.
Market participants caution that any further increase in capital requirements would need to be carefully sequenced to avoid disrupting credit flows or market stability. Even so, many agree that a stronger banking system would enhance Nigeria’s resilience to external shocks and support sustainable growth over the long term.
As the recapitalisation exercise continues, Otedola’s proposal has added momentum to a growing policy discussion over whether Nigeria’s banking system should move beyond minimum compliance toward a higher capital standard aligned with its long-term economic ambitions.
