CBN gives regional banks six months to expand to more regions

THE CENTRAL BANK OF NIGERIA (CBN) has given regional banks in the country six months to increase their presence to at least two regions of the country in order to promote regional spread.

Regional banks which are allowed to operate in a minimum of five and a maximum of 10 contiguous states are required to have N15 billion minimum paid-up capital.

The CBN said in a circular titled “Expansion of the scope of regional banks in Nigeria,” which was signed by Kevin Amugo, director, financial policy and regulation department, that all regional banks shall be required to operate from one additional geo political region as may be prescribed by the CBN in order to promote spread and balance of regional banks across the country.

The CBN said the latest directive was to promote financial inclusion

“The Central Bank of Nigeria, pursuant to Section 8 (g) of the CBN scope, condition and minimum standards for commercial banks regulation No. (1) 2010 as revised on September 4, 2019, and in furtherance of its objective to promote financial inclusion, hereby prescribes additional requirements for licensed regional banks (commercial and non-interest).

“Effective from the date this circular, all banks with regional authorisation shall be required to operate from one additional geopolitical zone as may be prescribed for each institution by the CBN, without prejudice to the existing requirement of minimum of two geo-political zones of the federation.

“The essence is to promote spread and balance of regional banks across the country.

“The compliance timeline to establish operational footprint at the advised zone shall not exceed six months from the issuance of the regulatory advice to each regional bank by the CBN.”