As the recapitalisation deadline set by the Central Bank of Nigeria draws closer, fresh concerns are emerging over the fate of at least 13 banks still racing to meet the new minimum capital requirement, with analysts warning that mergers may yet reshape the industry.

At the end of the Monetary Policy Committee meeting on Tuesday, CBN Governor Olayemi Cardoso said 20 banks have fully met the new minimum capital requirements, while a further 13 are at advanced stages of their capital-raising processes.

Speaking with The PUNCH on Wednesday about the fate of the lenders, management and financial consultant Boniface Chizea hailed the sector’s resilience in meeting the new capital thresholds.

“The results that they have achieved today, some of us were surprised because we thought that it was going to alter the landscape of banking, you know, radically, drastically. Like in the past, when the capital gains were raised suddenly from N2bn to N24bn. So it affected things; there were a lot of mergers, and there was panic.

“But it seems, I don’t know what happened this time, the banks seem to have done quite well, you know, so maybe they found lots of reserves, maybe they’ve been anticipating. So if we’ve done as well as we’ve done, that is very good, you know, so it should mean that the shock to the system, the shake-up that we thought was going to happen, probably at the end of the day, would not happen.”

He added that institutions unable to meet the requirement may have little choice but to combine forces. “So the banks that are not able to make it, of course, the only option they have would be to merge.

But unfortunately, with the merger, we’ve had to make sure that we don’t take over, and so on. Because, of course, when you merge, there must be a senior partner in that merger,” he affirmed.

Chizea stressed that depositor protection must remain central to any consolidation process. “Because what’s most important is the interest of the average bank customer, to make sure that bank customers are not badly affected. You have issues, your bank is having capitalisation issues, the deadline has come, and then that starts affecting your access to your deposits.”

He also suggested that an extension of the deadline could be considered, given the magnitude of the increase. “Well, given the extent of the increase, I think that we expect that it would be a good thing to do, so it would be for him to give an extension of the deadline. I think that’s not very well, because the hike was too much.”

The CEO of Arthur Steven Asset Management, Tunde Amolegbe, noted that while no public confirmation of merger talks exists, such conversations may be ongoing discreetly.

“Yes, I will assume so. And the reason why I say I will assume so is that we’ve not heard any indication that some banks are already having conversations around that. But even then, it’s very possible that those conversations are being had, but they are not public yet.”

Recalling past consolidation exercises, Amolegbe said: “Don’t forget that during Soludo’s time, some of the banks that ultimately could not make it prior to the deadline were essentially possibly matched by CBN. You remember that there were five banks or so that were put together to form another bank then. So that fuel is still there for the CBN to essentially force a merger.”

He also highlighted alternative pathways, including licence downgrades and private capital injections, which were options made available to lenders by the CBN at the start of the recapitalisation process.

“Beyond the public raising of capital in the form of a public offer, some of them could also be having conversations to do private placements of shares. Institutional investors and high-net-worth investors could be asked to inject capital between now and the deadline. Quite a bit could still happen,” he stated.

On the likelihood of consolidation, Amolegbe tied the probability to the regulator’s stance on extension.

“If your argument is that CBN does not ultimately consider extending the deadline, then I will argue that the probability of a merger would be very high. If there’s a possibility that CBN might consider giving a bit more time, then that might reduce the possibility of mergers.”

Head of Financial Institutions Ratings at Agusto & Co, Ayokunle Olubunmi, said many of the banks classified as being at an advanced stage of compliance have already secured the required funds.

“You’ll be shocked that a lot of those that the CBN said are at an advanced stage, some of them already have the funds with the CBN. What CBN is doing is verifying those funds. So it’s not that they are still going in the markets looking for the funds. The bulk of them have actually raised the funds. All they are trying to do is to just get the regulatory approval for that particular fund. So it looks like most of the banks are going to cross the line.”

He clarified that the recapitalisation conversation excludes banks currently under regulatory intervention by the apex bank. “Remember that he mentioned all this discussion excludes those under regulatory intervention. The three banks that are under CBN regulatory intervention. Those are not in this discussion. They are under the CBN regulatory purview. There are a lot of issues. There are a lot of things that CBN is trying to resolve. So apart from even the issue of capital, the issue of the shareholders and the relationship with them are also there.”

Olubunmi added that the issues surrounding such banks may be more complex than publicly known. “But the thing also is that we don’t know because CBN didn’t really tell us what the issues are. The issues might be that deep and might be complex. And also, don’t forget that there are a lot of things that could have been happening behind the scenes.”

Already, the CBN governor has said that lenders under regulatory oversight face a different recapitalisation timeline. The PUNCH reports that under the new recapitalisation deadline, banks with international licences must raise their minimum paid-up capital to N500bn, while those with national authorisation are required to meet a N200bn threshold before the March 31, 2026, deadline.

Regional commercial and merchant banks are expected to have a minimum capital base of N50bn, while non-interest banks must hold N20bn for national licences and N10bn for regional licences.