The Business NG - June 18, 2025

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BusinessNG Editorial Focus for June 18

As the Central Bank of Nigeria tightens its regulatory grip, banks burdened by non-performing loans are now barred from paying dividends, awarding executive bonuses, or making new offshore investments until full provisioning is made. This decisive policy targets institutions previously shielded under forbearance during past economic crises.

Renaissance Capital’s report, “Nigerian Banks, Cash is King,” reveals that Zenith Bank has the largest exposure at 23% of its loan book ($1.6 billion), followed by FirstBank (14%, $887 million), and Access Bank (4%, $304 million). Fidelity and FCMB also face scrutiny, while GTCO and Stanbic IBTC are in the clear.

These restrictions hit the core banking arms hardest, dampening shareholder returns. Although holding companies may try to cushion the impact via non-bank subsidiaries, such payouts will likely be minimal. The move has drawn anger from shareholders, many of whom rely on consistent dividend income.

BusinessNG examines the full implications for the banking sector, market confidence, and investor trust.