CBN SUSPENDS DIVIDEND PAYOUTS, BONUSES, AND FOREIGN INVESTMENTS FOR SEVEN MAJOR BANKS OVER CAPITAL ADEQUACY CONCERNS
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By Aishat Momoh. O.
In a sweeping regulatory move aimed at strengthening the Nigerian banking sector, the Central Bank of Nigeria (CBN) has directed seven of the country’s leading banks to temporarily suspend dividend payments, executive bonuses, and foreign investments. The decision, announced in line with a new regulatory circular, affects the following banks: Zenith Bank, Access Bank, GTCO, UBA, FBN Holdings, FCMB, and Fidelity Bank.
This action stems from the banks’ ongoing regulatory forbearance status, which allows them to continue operations despite not fully meeting capital adequacy requirements. The CBN is taking steps to independently verify the actual financial health of these banks before allowing further distributions to shareholders or expansion into foreign ventures.
Breakdown of Forbearance Exposure:
According to data from Renaissance Capital Africa, the combined exposure of the seven banks under regulatory forbearance amounts to $4.01 billion:
Zenith Bank – $910 million
FBN Holdings – $848 million
UBA – $771 million
Fidelity Bank – $556 million
Access Bank – $535 million
FCMB – $332 million
GTCO – $60 million
The CBN said this intervention is designed to reinforce capital buffers, enhance balance sheet resilience, and safeguard long-term financial stability within the banking system.
“This supervisory measure ensures banks retain resources to meet obligations and maintain strong prudential positions,” said CBN official Olubukola Akinwunmi.
Zenith Bank Responds
In a circular dated June 17, 2025, Zenith Bank confirmed the temporary suspension and provided assurance to shareholders. The bank clarified that its SOL (Single Obligor Limit) forbearance exposure involves only a single obligor and that it has successfully raised over the N500 billion capital requirement. The bank also expects to exit all CBN forbearance arrangements by the end of June 2025, allowing it to resume dividend payments within the year.
“We remain confident that the bank will satisfy all relevant conditions to enable it pay dividends to shareholders in the current year,” said Company Secretary Michael O. Otu.
Implications for Investors
Investors should expect delayed or suspended dividend payouts from the affected banks while they work to meet the new capital thresholds. The CBN’s recapitalization drive, which will be phased in through 2026, signals a shift towards financial fortification over short-term returns. While this may affect near-term bank stock performance, analysts see it as a necessary move to ensure sector-wide stability.
Ultimately, this regulatory pause is not punitive, but a proactive buffer to allow Nigeria’s top lenders to adjust and stabilize under tighter global and local financial scrutiny.
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