Banking Shake-Up Looms: Ten Banks Cross ₦500bn Mark as Mid-Tier Lenders Scramble — Ukpong Cautions Against Favouritism

Nigeria’s banking industry is heading for its biggest shake-up in two decades as ten banks have now crossed the Central Bank of Nigeria’s (CBN) recapitalisation threshold, reinforcing their dominance ahead of the 2026 deadline.

The recapitalisation drive, announced in 2024 by CBN Governor Olayemi Cardoso, requires international commercial banks to raise their minimum capital base to ₦500 billion, national banks to ₦200 billion, and regional banks to ₦50 billion. The policy is aimed at strengthening the sector against shocks, restoring investor confidence, and aligning Nigerian banks with global financial standards.

The Leaders: Ten Banks Already Safe

The latest announcement pushes the number of compliant institutions to ten, with Zenith Bank, Access Holdings, United Bank for Africa (UBA), Guaranty Trust Holding Company (GTCO), First Bank of Nigeria Holdings (FBNH), Stanbic IBTC, Ecobank Nigeria, Fidelity Bank, Sterling Bank, and Polaris Bank all in the clear.

These institutions, widely regarded as systemically important banks, leveraged retained earnings, robust shareholder support, and in some cases rights issues, to cross the capital bar. With strong regional footprints and global correspondent networks, they are expected to emerge stronger and more competitive in the post-2026 financial landscape.

The Pressure Zone: Mid-Tier Banks Facing Hard Choices

But while the Tier-1 giants are comfortably ahead, several mid-tier lenders are now caught in a high-stakes race for survival. Among them:

• Wema Bank – With its innovative digital-first ALAT platform, Wema is growing but still far from the ₦500bn requirement. Analysts expect it to seek equity partners or explore mergers.
• Unity Bank – Seen as one of the weakest in terms of balance sheet, Unity faces an uphill battle and may not survive without urgent intervention or a buyout.
• Jaiz Bank – Nigeria’s pioneer Islamic lender has niche strength but lacks scale. A merger or foreign partnership could be its lifeline.
• FCMB Group – Though relatively stronger, FCMB still lags behind the new threshold. Analysts believe it may need either a large capital raise or strategic consolidation. Those banks with long plagued by operational struggles and widely viewed as the most vulnerable and a likely acquisition target.

  

Already, merger speculations are gaining ground. Possible tie-ups include Wema and Unity, or a merger between FCMB and Jaiz to combine corporate reach with Islamic banking expertise. Reports also suggest that foreign banks from North Africa and the Middle East are eyeing distressed Nigerian lenders as entry points into Africa’s largest market.

Flashback to 2004

Nigeria has walked this path before. In 2004, then-CBN Governor Charles Soludo raised the minimum capital base from ₦2 billion to ₦25 billion, sparking a wave of mergers and acquisitions that slashed the number of banks from 89 to 25.

That exercise birthed today’s Tier-1 giants, but it was not without controversy. Allegations of regulatory bias and selective enforcement haunted the process, with some banks accused of enjoying soft landings due to political ties while others were forced into unfavourable mergers.

Ukpong’s Warning: Keep the Process Fair

Against this backdrop, Celestine Ukpong, an economist and investor-savvy analyst, has cautioned the CBN to avoid repeating past mistakes.

“The process of recapitalisation should be seamless and strictly guided by market principles,” Ukpong said.
“Any hint of favouritism or selective support will not only distort fair competition but also undermine investor confidence. The CBN must ensure a level playing field so that both big and mid-tier banks can compete fairly in raising capital.”

Ukpong stressed that fairness and transparency are as critical as the capital thresholds themselves. “If this process is handled fairly, Nigeria’s banks will emerge stronger and more trusted globally. If not, we risk repeating the mistakes of 2004, where perception of bias cast a shadow on an otherwise bold reform,” he added.

The Road to 2026: Winners and Losers

As the countdown continues, analysts agree that recapitalisation will produce clear winners and losers. For shareholders and employees of smaller banks, the stakes are high: survival through mergers and capital raises, or exit from the sector altogether.

An industry analyst summed it up bluntly:
“The Nigerian banking industry is entering another consolidation cycle. For some banks, 2026 will be a rebirth. For others, it will be an obituary.”

What remains clear is that 2026 will redefine Nigeria’s banking map — not just in the number of players, but in their strength, governance, and ability to compete globally

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