Two financial institutions listed on the capital market, the Nigerian Exchange Limited, Access Holding Plc and Zenith Bank Plc have assured their shareholders that they will distribute dividend by the end of the 2025 financial year despite the recent directive by the Central Bank of Nigeria with regards to forbearance on single obligor limit.
A third institution, First City Monument Bank Group said it has concluded plans to convert N23.1 billion loan facilities to equities, and as well assured shareholders of the possibility of dividend payout at the close of the 2025 financial year.
The CBN had letter, BSD/DIR/COM/LAB/018/008, dated June 13, 2025, directed banks to suspend dividend payout to shareholders temporarily, bonuses to directors and senior management staff, and halt investments in foreign subsidiaries or new offshore ventures to enhance capital buffers and provisioning for their forbearance exposure and single obligor limit. The measure is part of the regulatory strategy to accelerate the ongoing recapitalisation programme set to be concluded by March 31, 2026.
On Monday, Renaissance Capital named six banks, namely Access Holding Plc, First Holdco Plc, FCMB Group, UBA and Zenith Bank Plc as financial institutions affected by the CBN directive.
But in reaction to the CBN pronouncement, Access Holding and Zenith Bank in a notice to the NGX on Wednesday said they have met the N500 billion minimum capital requirement for international operations.
Access Holdings in a statement signed by the company secretary, Sunday Ekwochi assured investors of meeting the regulatory demand and paying dividends by the year end.
“As of December 31, 2024, the Company’s banking subsidiary, Access Bank Plc (‘the Bank’) was the first bank to meet and exceed the Central Bank of Nigeria’s N500 billion minimum capital requirement for commercial banks with international authorisation.
“In accordance with the Central Bank of Nigeria’s directive mentioned in the referenced letter, the Bank is currently compliant with the single obligor limit requirement as of the date herein and will continue to ensure adherence to this regulation.
“Regarding the regulatory forbearance on credit facilities, the Bank will comply with the apex bank’s directive by June 30, 2025, while maintaining strong capital buffers and paying dividend to its shareholders.
“We assure our esteemed shareholders and stakeholders of our commitment to delivering sustainable value in the immediate and long term and thank them for their trust and support over the years.”
Similarly, the company secretary of Zenith Bank Plc, Micheal O. Otu, in a statement titled, “Re: Temporary Suspension of Dividend Payments, Bonus and Investments in Foreign Subsidiaries,” promised that bank will pay investors dividend in the 2025 financial year.
Explaining how the firm intends to actualise this in face of the new regulations, he stated that, “The Bank has successfully raised and surpassed the new regulatory capital requirement of N500 Billion. The Bank’s exposure under the SOL forbearance relates solely to a single obligor. We are confident that this exposure will be brought within the applicable regulatory limit on or before 30 June 2025.
“With respect to the forbearance granted on other credit facilities, the Bank confirms that this applies to only two (2) customers. We have made substantial provision in respect of these facilities and have taken appropriate and comprehensive steps to ensure full provisioning 30 June 2025. Upon completion, the Bank will no longer be under any forbearance arrangements by the end of the first half of 2026.
“Accordingly, we remain confident that the Bank will satisfy all relevant conditions to enable it to pay dividend to shareholders in the current year.”
Earlier, FCMB Group company secretary, Funmi Adedibu, in notification to the NGX on Tuesday explained how the firm will overcome the challenges posed by the new CBN regulation as follows:
“Following the recent directive from the Central Bank of Nigeria (CBN) on enhanced prudential measures for banks operating under regulatory forbearance, FCMB Group Plc (“FCMB Group”) wishes to reassure its investors, analysts, and stakeholders of its strong commitment to regulatory compliance, prudent capital management, and long-term financial soundness.
“FCMB Group’s Nigeria Banking Subsidiary currently has loans under CBN forbearance (credit exposures to 3 entities and 2 obligors) amounting to ₦207.6 billion as at 31st May 2025 (down from N538.8 billion as at September 30th, 2024). These are currently classified as Stage 2 loans. The Bank has made provisions for these loans over the last few years, and intensified resolution efforts have led to over 60% reduction in its credit forbearance exposures.
“Once these loans exit the CBN forbearance regime, we anticipate that this would lead to an initial spike in Stage 3 loans to ~11.5% of the total loan book which would decline below 10% by the end of the financial year, based on anticipated loan book growth. The Bank has one (1) additional obligor (classified as a Stage 1 loan since drawdown to date) on the CBN forbearance for Single Obligor Limit (SOL).
“This Obligor will be brought within SOL limit by September 30th, 2025, following the conversion to equity of a recently concluded N23.1 billion Convertible Loan and audited nine (9) months projected retained earnings. The Group has already received CBN approval for the capital verification of the Convertible Loan and we are currently processing the other regulatory approvals required.
“We intend to conclude this process, including down-streaming the capital proceeds to the Bank by the end of July 2025. This would effectively take the Share Capital and Share Premium of the Bank to ~ ₦267 billion. Capital Adequacy will remain above the regulatory minimum of 15% for international banks post forbearance, reinforced with the addition of the converted equity by July 2025 and the planned audit of nine (9) months retained earnings.
“Our Nigerian Banking Subsidiary contributed 46% of 2024 dividend paid to shareholders (the balance coming from other non-bank subsidiaries).
“Barring any unforeseen circumstances, the Group expects to have sufficient buffers to maintain its dividend policy for the financial year 2025 and the immediate subsequent years. We appreciate the continued trust and confidence of our customers, investors and stakeholders and we will continue to give regular and timely updates as may be required.”