Guidelines for Recapitalization of Banks and Other Financial Institutions
A little more understanding of the world of finance.
Here we break down the finance institutions by type with descriptions of each of their scopes of business.
In its bid to strengthen Nigerian banks against external and domestic shocks and enhance the stability of the financial system, the Central Bank of Nigeria (CBN) has issued guidelines for the recapitalization of banks in Nigeria. The rationale behind this decision is to ensure that banks have a robust capital base to absorb unexpected losses and the capacity to contribute to the growth and development of the Nigerian economy.
The new capitalization requirements enforced on the banks are as follows:
International operations: ₦500 billion minimum
National operations: ₦200 billion minimum
Regional operations: ₦50 billion minimum
National operations: ₦50 billion
National operations: ₦20 billion
Regional operations: ₦10 billion
To learn more about the guidelines issued by CBN, click the link below.
Following the Central Bank of Nigeria's (CBN) Recapitalization Guidelines for Banks and Other Financial Institutions, the Corporate Affairs Commission (CAC), pursuant to its powers under Section 8 (1) (e) of the Companies and Allied Matters Act (CAMA) No. 3 of 2020, has also issued the following guidelines to ensure a smooth recapitalization process:
New Incorporation Documentary and Other Requirements
Approved Name Reservation or Availability
Approval-in-Principle from Sector Regulator
Duly completed online incorporation form
Payment of stamp duty and filing fees for the category of license authorization
Note: The Certificate of incorporation shall be issued within 24 hours for applications that satisfy all requirements for incorporation of companies prescribed in the Commission's Operations Checklists available at www.cac.gov.ng/resources.
2. Increase in Share Capital (Options - private placements, rights issue, and/or offer for subscription) Documentary and Other Requirements
Duly signed company resolution
Statutory declaration by directors verifying that the issued share capital is fully paid-up
Notice of the fact that regulatory approval is required
Affidavit deposed to by a company director to the effect that regulatory approval is required for the increase
Amended memorandum of association reflecting the new share capital
Payment of stamp duties and filing fees
Issuance of a letter acknowledging notice of increase and requirement of regulatory approval
Filing of regulatory approval
Issuance of certificate of increase
Notice of the fact that regulatory approval is required must be filed in accordance with the provisions of Section 127 (3), (4) & (5) of CAMA.
Annual returns and information on persons with significant control must be up-to-date.
A certificate of increase shall be issued within 24 hours of filing regulatory approval.
3. Merger Documentary and Other Requirements
Duly signed special resolution for merger by each of the merging companies
Scheme of Merger duly approved by the Securities and Exchange Commission (SEC)
Certified true copy (CTC) of Court order authorizing Extraordinary General Meeting (EGM) of each of the merging companies
Evidence of publication of Court-ordered meeting in two newspapers and the Federal Gazette
CTC of Court order sanctioning the Scheme of Merger
Note: Annual returns and information on persons with significant control must be up-to-date.
4. Upgrade and Downgrade of License Authorization
No consequential filing is required.
All enquiries and complaints regarding these guidelines and applications submitted in pursuance of the recapitalization exercise should be addressed to [email protected]
You could also direct enquiries to any of the following:
