With the completion of bank recapitalization, the Central Bank of Nigeria (CBN) has charged the financial institutions in the country to focus on supporting the productive sector.
The CBN Governor, Mr. Olayemi Cardoso, who briefed the Senate Committee on Banking, Insurance and Other Financial Institutions on the activities of the apex bank yesterday, said: “With recapitalisation now completed, our focus has shifted towards ensuring that stronger capital translates into improved governance, enhanced risk management and support for productive economic activities.”
Speaking during the open time before the meeting went into closed session, Cardoso highlighted the launch of the Payments System Vision 2028, improvements in Nigeria’s sovereign credit ratings by Fitch, Moody’s and S&P, stronger fiscal-monetary policy coordination and other reforms aimed at sustaining financial system stability.
He expressed confidence that inflation would continue to moderate in the second half of the year, while the apex bank would intensify post-recapitalisation supervision, deepen foreign exchange reforms, strengthen digital payment systems and reinforce the resilience of the financial sector.
Cardoso added that the CBN had set a target of increasing monthly diaspora remittances through official channels to $1 billion before the end of the year. He said this is part of the efforts to strengthen foreign exchange inflows and consolidate macro-economic stability.
The Senate committee subjected the bank’s management to extensive questioning on inflation, bank recapitalisation, foreign exchange reforms, consumer protection, the CBN’s audited accounts and the handling of the Federal Government’s Ways and Means advances.
Cardoso, who led the CBN delegation, said recent monetary and financial sector reforms had strengthened investor confidence, stabilised the foreign exchange market and positioned the economy for sustainable growth despite persistent global economic challenges. He said the first half of 2026 witnessed consolidation of the macro-economic gains achieved in 2025 through sustained monetary reforms and closer coordination between monetary and fiscal authorities.
According to him, despite heightened global uncertainties arising from geo-political conflicts, trade fragmentation and supply chain disruptions, Nigeria’s economy had remained resilient, supported by improving business conditions and stronger private sector confidence. He said inflation had resumed its downward trend after the temporary spike caused by the Middle East crisis, easing marginally from 15.93 per cent in May to 15.91 per cent in June. “This outcome demonstrates the effectiveness of our monetary policy stance in containing second-round inflationary pressures and anchoring inflation expectations. We remain fully committed to restoring price stability and achieving single-digit inflation over the medium term,” Cardoso said.
The CBN governor said reforms introduced in the foreign exchange market had enhanced transparency, improved investor confidence and curtailed speculative activities. He listed the launch of the fourth edition of the Foreign Exchange Manual, implementation of the Nigeria Foreign Exchange Code and deployment of the Electronic Foreign Exchange Matching System as major reforms driving stability in the market.
Cardoso disclosed that the average exchange rate appreciated to N1,375.40 to the dollar in the first half of 2026, while Diaspora remittances through official channels rose from about $200 million to over $600 million monthly. “Our target is to increase Diaspora remittances to $1 billion monthly before the end of the year,” he said.
Cardoso added that Nigeria’s external reserves had climbed to $52.73 billion as of July 9, 2026, reflecting improved foreign exchange inflows and stronger external buffers.
He described the CBN bank recapitalisation as one of the most successful in the country’s banking history. He said banks raised N4.65 trillion in fresh capital, with 72.55 per cent contributed by domestic investors and 27.45 per cent by foreign investors. According to him, 33 banks had met the revised capital requirements, while discussions were ongoing, with the few institutions yet to comply to protect depositors and preserve financial system stability.
The engagement was chaired by Senator Mukhail Adetokunbo Abiru (Lagos East). Abiru acknowledged improvements in key macro-economic indicators since the committee’s last meeting with the CBN. He noted that inflation had moderated to 15.06 per cent in February 2026, prompting the Monetary Policy Committee (MPC) to lower the Monetary Policy Rate (MPR) from 27 per cent to 26.5 per cent. However, inflation later rose to 15.93 per cent in May, following geo-political tensions in the Middle East.
While commending the CBN for restoring stability to the foreign exchange market and successfully implementing the banking sector recapitalisation programme, the committee chairman said the banking reform would only achieve its objective if banks increased lending to productive sectors of the economy. Abiru identified agriculture, manufacturing, infrastructure, technology and small and medium enterprises (SMEs) as critical sectors expected to benefit from stronger bank capitalisation.