JPMorgan Pays $38m to CBN for Merchant Banking Licence

By Adedapo Adesanya

American lender, JPMorgan Chase & Co., has deposited N50 billion ($38 million) with the Central Bank of Nigeria (CBN) as part of efforts to secure a licence to operate a merchant bank in Nigeria, Bloomberg has reported.

The deposit is one of the final regulatory requirements for approval and signals the US lender’s readiness to commence operations once its application is approved.

According to the report, the bank hopes to obtain the licence by the end of 2026 or early 2027, subject to securing all necessary regulatory approvals.

On October 8, Mr Dapo Olagunji, managing director of JPMorgan West Africa, announced plans to establish a merchant bank in Nigeria, with operations expected to begin before the end of 2026, subject to regulatory approval.

The proposed merchant bank would expand JPMorgan’s presence beyond its existing representative office in Lagos, where it provides commercial and investment banking services, alongside asset and wealth management.

The move comes as Nigeria seeks to deepen its financial markets and attract international investment.

On September 14, JPMorgan included Nigeria in its new emerging markets index, assigning the country a 7.4 per cent weighting.

The Government Bond Index-Emerging Markets Edge (GBI-EM Edge), which tracks local-currency government bonds across frontier markets, was launched at the end of September.

Nigeria’s inclusion came nearly 11 years after the country was removed from JPMorgan’s GBI-EM in 2015. Its 7.4 per cent weighting reportedly makes it one of the largest markets represented in the new benchmark.

In 2024, the central bank raised the minimum capital requirement for merchant banks with national licences to N50 billion as part of efforts to shield banks from external shocks.