The Centre for the Promotion of Private Enterprise (CPPE) has backed the Central Bank of Nigeria’s decision to increase the capital base of banks, despite calling for proper management to prevent economic disruptions.

This was revealed in a statement signed by the Chief Executive Officer of CPPE, Dr Muda Yusuf.

The CBN announced the review of capital requirements for affected banks, citing domestic and global shocks.

Commercial banks with international authorization are directed to increase their capital base to N500bn, national banks to N200bn, and non-interest banks with national and regional authorizations to increase their capital to N20bn and N10bn, respectively.

CPPE Chief Executive Officer Dr Muda Yusuf emphasized the necessity of bank recapitalisation due to inflation, which has eroded the bank’s capital base over time.

He called for orderliness in the recapitalisation process to minimize disruptions and ensure a smooth transition to the new capitalisation regime.

The current categorization of banks with differential capital requirements is maintained to allow for inclusion and reduce the risk of dominance by a few big banks.