In a move aimed at bolstering Nigeria’s banking sector and supporting the Central Bank of Nigeria’s (CBN) recapitalisation programme, the Securities and Exchange Commission (SEC) has unveiled its Framework on Banking Sector Capitalisation Programme for 2024.
Published on the SEC’s official website on Friday, the framework serves as a comprehensive guide for Banks/Holding Companies and market participants to navigate the recapitalisation programme effectively.
The initiative comes in response to the CBN’s directive for banks to enhance their capital base to better serve Nigeria’s growing economy, targeting a $1 trillion GDP by 2030.
Under the new capital requirements, international banks are mandated to raise their capital base to N500 billion, national banks to N200 billion, and regional banks to N50 billion.
According to the SEC, the framework is designed to ensure that the capital-raising process is conducted efficiently, transparently, and in a manner that safeguards the interests of all stakeholders.
”It will facilitate full disclosure of material facts in compliance with the Investments and Securities Act 2007, SEC Rules and Regulations, and other relevant laws.
”Among its objectives, the framework aims to guide Banks/Holding Companies issuers and Capital Market Operators in filing applications for capital raise, mergers, and acquisitions.
”It emphasizes the importance of proper and timely review of these transactions to ensure regulatory compliance,” SEC noted.
Highlighting the role of the capital market in the recapitalisation programme, the SEC emphasized that banks are expected to leverage the market to raise necessary funds and engage in business combinations to strengthen their asset base.
Applications and documents for capital raise are to be filed electronically via [email protected], with the SEC ensuring prompt review and communication of any deficiencies to applicants.
The framework stipulates penalties for incomplete applications, indicating the SEC’s commitment to a transparent and efficient process.
The SEC urged banks and stakeholders to adhere to the guidelines outlined in the framework, which complements existing SEC Rules and Regulations and should be read alongside the Investments and Securities Act, 2007.
In a related development, the Association of Corporate & Marketing Communication Professionals of Banks (ACAMB) has expressed strong confidence in the Nigerian banking sector’s readiness to meet the upcoming recapitalization requirements mandated by CBN.
The assurance by the ACAMB follows the release of a much-anticipated circular detailing the recapitalization process.
The association, alongside other key stakeholders, expressed robust support for the initiative, emphasizing its potential to enhance the growth and stability of Nigerian banks.
