Citigroup Inc. has strengthened its Nigerian presence by recapitalizing Citi Bank Nigeria Limited to meet the Central Bank of Nigeria’s ₦200 billion minimum capital benchmark for national lenders ahead of the March 2026 deadline.
The U.S.-based financial giant confirmed the capital injection in a statement on Wednesday, noting that the move reflects confidence in Nigeria’s economic future and positions Citi to expand financing across key sectors of the economy.
“With a strengthened balance sheet, Citi is ready to expand support for clients across priority sectors including infrastructure, energy and trade. It is a statement of confidence in Nigeria’s future and a deliberate investment in its next chapter of growth,” the bank said.
Strengthening Nigeria’s Banking Sector
Citi’s capital increase follows the Central Bank of Nigeria’s recapitalization directive introduced last year, which raised minimum capital thresholds tenfold for financial institutions to improve system resilience.
Under the revised framework:
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International banks must raise their minimum capital base to ₦500 billion (from ₦50 billion).
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National banks are required to meet ₦200 billion (from ₦25 billion).
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Regional banks must increase capital to ₦50 billion (from ₦10 billion).
The apex bank said the new standards aim to safeguard the banking industry against persistent macroeconomic pressures, including high inflation, currency volatility, and systemic credit risks.
According to the CBN, 14 out of 36 licensed financial institutions have already complied with the new capital rules, signaling early progress toward the regulator’s goal of a stronger, well-capitalized banking system.
Foreign Confidence Amid Economic Headwinds
Citi’s decision to recapitalize ahead of schedule highlights a rare show of foreign investor confidence at a time when Nigeria faces a challenging economic environment marked by naira devaluation, tight liquidity, and elevated inflation.
By committing ₦200 billion in new equity, the American lender reinforces its 41-year presence in Nigeria, underscoring its strategic belief in the country’s long-term market potential despite short-term volatility.
The move aligns with recent reforms by the administration of President Bola Ahmed Tinubu, including exchange rate unification, subsidy removal, and banking sector stabilization measures — policies aimed at restoring fiscal sustainability and attracting foreign capital inflows.
Market analysts view Citi’s recapitalization as both a vote of confidence in Nigeria’s reform trajectory and a potential signal for other international investors to re-engage the market.
Sectoral Expansion: Infrastructure, Energy, and Trade
With a stronger balance sheet, Citi Bank Nigeria plans to scale up its financial intermediation in infrastructure, energy, and trade finance, three sectors regarded as critical to Nigeria’s economic recovery and industrial expansion.
The recapitalization will allow the bank to increase its credit exposure, participate in syndicated project financing, and support foreign exchange liquidity for corporate clients and trade partners.
Nigeria’s infrastructure financing gap is estimated by the African Development Bank at over $100 billion annually, while energy sector reforms continue to attract global interest.
Citi’s expanded balance sheet positions it to play a pivotal role in closing these financing gaps through structured lending and capital market facilitation.
Regulatory Alignment and Financial Stability
The Central Bank’s recapitalization directive comes two decades after the 2005 consolidation exercise that reduced Nigeria’s commercial banks from 89 to 25 through mergers and acquisitions. That reform, led by then-CBN Governor Charles Soludo, created stronger institutions with improved capital adequacy ratios.
The 2024 recapitalization effort follows a similar logic — ensuring that Nigerian banks remain well-capitalized to absorb shocks and fund larger transactions in an increasingly complex economic landscape.
Citi’s compliance demonstrates the readiness of foreign-owned banks to align with CBN’s stability agenda and underscores the resilience of Nigeria’s financial sector in attracting fresh offshore commitments despite global uncertainties.
Reinforcing Nigeria’s Position in African Finance
Citi’s strengthened operations are expected to further consolidate Nigeria’s standing as West Africa’s financial hub, supporting both domestic and cross-border transactions under the African Continental Free Trade Area (AfCFTA) framework.
The recapitalization also enhances Citi’s capacity to support multinational clients, facilitate dollar liquidity, and deepen foreign trade financing across Africa’s largest economy.
As the Nigerian banking sector enters a new phase of consolidation and capitalization, foreign-backed banks like Citi are likely to benefit from increased credibility, operational flexibility, and strategic partnerships with government and private entities.
Outlook
Citi’s ₦200 billion capital boost reinforces Nigeria’s status as a critical financial destination for multinational institutions despite prevailing headwinds.
Its proactive compliance with the CBN’s capital policy reflects long-term strategic positioning and confidence in Nigeria’s regulatory and economic reform agenda.
The development sends a clear message to the global investment community that, even amid macroeconomic challenges, Nigeria remains a viable and resilient market with strong reform potential and significant opportunities for financial growth.