Report: Nigeria’s banking sector raised N2.5trn for recapitalisation in 19 months

Nigeria’s banking industry raised about N2.5 trillion fresh capital between January 2024 and July 2025, according to a new report by Agusto & Co. Limited.

The credit rating agency said 16 banks collectively raised N1.7 trillion in 2024, while another N800 billion was secured in the first seven months of 2025.

The funds are part of ongoing efforts to comply with the Central Bank of Nigeria’s (CBN) new minimum capital requirement directive, which takes effect on March 31, 2026.

Since the CBN directive was announced, commercial banks have been racing to raise funds through various strategies — including private placements and rights issuances.

“Thus, eight banks have complied with the minimum paid-up capital directive as at 31 July 2025, ahead of the 31 March 2026 deadline,” Agusto & Co. said.

“However, the mandatory verifications by the Central Bank of Nigeria (CBN) and the Securities and Exchange Commission (SEC) are pending on some of the capital raised.

“We note positively that domestic investors provided most of the capital raised by the banks in the last 19 months, reflecting the acceptability of the Industry by Nigerians.”

The agency said it anticipates the injection of an additional N900 billion as a significant number of banks strive to comply with the minimum capital directive before 31 December 2025.

This, the reports said, will provide “additional capital buffers for current business risks and near-term growth plans”.

BANKS’ TOTAL ASSETS TO HIT N242TRN BY 2025

Beyond recapitalisation, Agusto & Co. projected a strong asset growth for the sector.

According to the firm, the industry’s total assets and contingents are expected to hit N242.3 trillion ($151.4 billion at N1,600/$) by December 2025 — a 44.9 percent year-on-year increase from N186.6 trillion ($121.5 billion) recorded at the end of 2024.

“Notwithstanding the funding pressure from the prevailing high-interest rate environment and the contractionary stance of the monetary authority, the industry remained liquid with a 59.4% (FYE 2023: 43.5%) liquidity ratio,” the report said.

Agusto expects this to exceed 60 percent in 2025.

“In our view, banks will accelerate the adoption of innovative funding strategies, as reflected in the uptick in commercial paper issuances, to moderate the impact of the funding pressures,” the rating firm said.

“In the first seven months of 2025, commercial papers amounting to circa N750 billion were issued by various players. We anticipate more issuances particularly as the prevailing yields gradually moderate in the latter part of the year.”

However, the report flagged rising asset quality risks, stating that the industry’s non-performing loans (NPL) ratio, which stood at 5.2 percent in 2024, is projected to climb to 6.9 percent in 2025 following the CBN’s termination of regulatory forbearance.

Agusto & Co. maintained a “stable” outlook for the industry, citing strengthened capital buffers, improved liquidity, and long-term growth opportunities despite short-term pressures.