After banks raised ₦4.65 trillion in fresh capital, the Fund calls for stronger supervision, adequate liquidity and early recognition of bad loans.
The International Monetary Fund (IMF) has urged Nigeria to strengthen banking supervision, maintain adequate capital and liquidity buffers, and ensure the timely recognition of bad loans following the country’s banking sector recapitalisation exercise.
The Fund warned that increasing banks’ capital reserves, although important, would not by itself guarantee financial stability without effective regulation and sound risk management.
The Central Bank of Nigeria (CBN) reported that 33 banks had met the revised minimum capital requirements by the end of the recapitalisation programme, raising a combined ₦4.65 trillion in new capital.
Introduced in March 2024, the exercise reached the end of its two-year compliance period on March 31, 2026.
According to the CBN figures, domestic investors accounted for 72.55 per cent of the capital raised, while international markets contributed the remaining 27.45 per cent.
The figures indicate substantial participation by local and foreign investors in efforts to strengthen the financial institutions covered by the programme.
However, the IMF has stressed that the next phase must focus on ensuring that stronger balance sheets translate into genuine resilience against economic and financial shocks.
Supervision and risk management remain critical
The Fund’s recommendations were highlighted by officials from its Monetary and Capital Markets Department during a briefing on Nigerian, African and global financial risks at the launch of the October 2026 Global Financial Stability Report.
The briefing took place during the ongoing IMF and World Bank meetings in Bangkok, Thailand.
The IMF’s position underscores the distinction between raising capital and maintaining a healthy banking system. Capital provides banks with a buffer against losses, but weaknesses in lending practices, poor asset quality, insufficient liquidity or delayed recognition of bad loans can still threaten their stability.
Stronger supervisory oversight is therefore important to identify emerging vulnerabilities before they develop into more serious problems.
Timely recognition of non-performing loans is particularly significant because it helps regulators and financial institutions assess the true condition of bank balance sheets rather than allowing underlying credit risks to remain concealed.
Adequate liquidity is equally important, enabling banks to meet their obligations and withstand periods of market pressure without undermining confidence in the financial system.
What the next phase means for Nigeria
For Nigeria, the challenge following recapitalisation is to ensure that the additional funds support a more resilient banking sector capable of financing productive economic activity while managing credit risks responsibly.
A stronger financial system can improve confidence among depositors, investors and businesses. Nevertheless, the benefits depend on sound governance, transparent reporting, effective enforcement of regulatory standards and prudent lending decisions.
The CBN’s recapitalisation figures mark a significant milestone in the effort to strengthen the sector, but the IMF’s warning makes clear that the exercise should be viewed as part of a broader regulatory and financial-stability agenda rather than an end in itself.