Banking
GTBank Foresees Banks Struggling With 15% CAR
**Expects Tighter System Liquidity, Rise in Interest Rates in 2021
By Dipo Olowookere
One of the leading financial institutions in the country, Guaranty Trust Bank (GTBank) Plc, is projecting a further increase in interest rates.
In its Nigeria Macro Economic and Banking Sector Outlook for 2021 obtained by Business Post, the lender said the spike in the interest rates would be triggered by “the additional borrowings by the government as well as relatively lower OMO maturities into the system.”
GTBank disclosed in the report that it also foresees the Central Bank of Nigeria (CBN) sustaining its “policy stance going into 2021 driven largely by the need to improve credit flow to spur economic growth.”
Recall that recently, in a move to attract portfolio flows and reduce the consistent exit of investors, the CBN increased yields of fixed income securities, causing investors to abandon the equity market, which has so far lost 4.03 per cent this year.
Liquidity expectation
Commenting on the liquidity outlook for the year, GTBank said it expects it to be tighter, noting that, “For one, only N4.3 trillion in OMO securities will be maturing this year, with over 50 per cent of that maturing within the first quarter of the year which implies about N2.5 trillion of liquidity injection into the system in Q1, with attendant CRR implications assuming that the CBN maintains its trend of reissuing a portion of the maturing securities.”
The lender noted that, “This could result in the outflow of more funds from the market in form of CRR,” adding that from Q2 2021, however, “we expect a shift in the liquidity situation of the market, based on the significantly reduced OMO maturities of N1.7 trillion.”
According to the bank, “In the absence of other liquidity injection sources, market liquidity is expected to tighten significantly with a resultant decline in special CRR debits.”
“As a result of the tightening of liquidity conditions expected in the market from Q2 2021, we anticipate a rise in volatilities within the money market and fixed income space.
“We also anticipate a renewed scramble for deposits by banks and other financial institutions to meet demands on them for funds.
“Money market rates, should on average, rise steadily across the period with a resultant pull on deposit and lending rates.
“In view of the above, the CBN might have to consider the possibility of releasing some of the CRR sterilised by it,” the report further said.
Banking sector capitalisation
In terms of the capitalisation of the banking sector, GTBank said it foresees some players struggling with the regulatory minimum capital adequacy ratio (CAR) of 15 per cent as a result of the devaluation of Naira.
“Consequently, we expect banks with shortfalls in their capital positions to retain more of [their] earnings to shore up their capital and keep themselves within touching distance of the minimum regulatory capital requirement.
“It is also not unlikely that the apex bank will offer some form of regulatory forbearance to banks that fall short of the minimum regulatory capital,” the report noted.
Over a decade ago, the banking sector in Nigeria went through a major transformation, with mergers and acquisitions to meet up with the minimum capital base of N25 billion. Some observers have called for a revisit of this amount because of the devaluation of the local currency since then.
Banks and Fintech competition
GTBank said in its report that it projects a level playing field for traditional banks and their non-bank competitors, which are mainly the financial technology (fintech) companies.
It explained this is expected because the CBN, with an expanded role in the new Banking and Other Financial Institutions Act (BOFIA) 2020, would likely increase the operational and regulatory costs of fintechs, which would stifle their drive in the long to medium term.
FX Outlook
In the report, the lender projected a tightening of the gap between the parallel market rate and the official rate due to a marginal adjustment of the currency in 2021.
“Our expectation of the appreciation of parallel market rates is predicated on increased supply to that market, however, it should be noted that a devaluation in the official market usually triggers an immediate devaluation in the parallel market even if short-lived.
“Notably, a further devaluation to levels closer to the general consensus of the true value of the Naira is expected to trigger increased foreign portfolio flows into the country,” it stated.
By Aduragbemi Omiyale
Children and teens interested in participating in becoming the chief executive of Wema Bank for one day have till Wednesday, May 20, 2026, to submit their entries.
The One-Day MD/CEO initiative was introduced by Wema Bank in 2025 to commemorate Children’s Day in a uniquely unprecedented manner.
The winner of the maiden edition was a 12-year-old Chiderije Mbah, inspiring children across the country to put in the work towards a successful future.
Inspired by the bank’s 80th anniversary theme, 80 Years of Impact, A Future of Possibilities, the Wema Bank One-Day MD/CEO initiative served as a bridge between past and future, giving children across Nigeria the once-in-a-lifetime opportunity to become the MD/CEO of Wema Bank for one day—Children’s Day.
For the 2026 Children’s Day celebration, Wema Bank will give another child or teenager [ages 0-16] a chance to step into the shoes of the chief executive of the bank, Mr Moruf Oseni, for a day.
The child will get to oversee board meetings, make tactical decisions, and experience firsthand the demands and responsibilities that come with the office of MD/CEO, especially for an institution like Wema Bank, Nigeria’s oldest indigenous national bank, most innovative and pioneer of Africa’s first fully digital bank, ALAT.
To participate, children/teens are expected to record a 60-second video detailing what their ideal role in banking would be and what they hope to achieve. This video is to be posted on any social media platform using #EvolutionOfPossibilities and tagging @wemabank on the post. The post with the highest number of likes emerges as the winner, and the winner gets to become MD/CEO of Wema Bank on Monday, May 25, 2026, in celebration of Children’s Day, with parents and teens encouraged to hurry and make their submissions before the deadline.
By Adedapo Adesanya
Nigerian tier-1 lender, First Bank, has announced the introduction of its Naira Visa Debit Card in partnership with the global payments giant to extend accessible, reliable electronic payment capabilities to a broader segment of the Nigerian population.
The card is targeted at everyday consumers who require a dependable payment instrument for routine domestic and international transactions. Accepted across POS terminals, ATMs, and online platforms through Visa’s payments network, the Naira Visa Debit Card is designed to reduce friction for customers transitioning from cash to electronic payments across retail, utilities, and digital commerce.
According to the bank, the partnership aligns with Nigeria’s ongoing drive toward a cashless economy, a policy direction that has gained significant momentum following successive Central Bank of Nigeria directives encouraging the adoption of electronic payment channels, adding that the card is intended to serve customers across the country’s diverse economic segments.
The Naira Visa Debit Card is available to all eligible FirstBank account holders through any of the bank’s branches nationwide.
Speaking on the launch, Mr Chuma Ezirim, Group Executive, eBusiness & Retail Products, FirstBank, said: “Everyday transactions should be simple, secure, and rewarding. The Naira Visa Debit Card is designed to make life easier for our customers, whether they are paying for groceries, settling utility bills, or shopping online.
“By extending reliable electronic payment access across Nigeria, we are helping more people transition confidently from cash to digital payments, supporting the nation’s cashless policy and empowering communities with greater financial inclusion.”
Commenting on the strategic importance of the partnership, Mr Andrew Uaboi, Vice President and Cluster Head, West Africa, Visa, noted: “A strong payments ecosystem works for everyone. The Naira Visa Debit Card extends reliable electronic payment access to everyday Nigerian consumers, and this in addition to the cards in our portfolio, continues to demonstrate what a truly comprehensive card portfolio looks like for the Nigerian market. Visa is proud to power this offering with FirstBank.”
The launch of the Naira Visa Debit Card broadens Visa’s card portfolio at FirstBank, which already includes products spanning credit cards and High-end premium lifestyle spending cards. The addition completes its offering across customer segments, ensuring that cardholders at every income level have access to a product suited to their needs.
By Adedapo Adesanya
The Central Bank of Nigeria (CBN) has unveiled the fourth edition of its Foreign Exchange Manual as part of efforts to deepen liquidity, improve transparency and strengthen confidence in the country’s foreign exchange market.
Speaking at the launch of the revised manual in Abuja on Friday, the Governor of the apex bank, Mr Yemi Cardoso, said the document will take effect from June 1, 2026.
He said it was developed after extensive consultations with banks, exporters, importers, corporates, regulators and development partners.
He said the new framework reflects the apex bank’s commitment to modernising the country’s foreign exchange administration in line with international best practices.
Mr Cardoso described the foreign exchange market as a critical pillar of any open economy, noting that effective governance of the sector is essential for sustaining macroeconomic stability and investor confidence.
“Foreign exchange is more than a financial instrument. It anchors price stability, facilitates the flow of goods and capital, and shapes investor sentiment,” he said.
The CBN governor stressed that the revised manual became necessary due to changing global economic realities, domestic reforms and the need for a more coherent and forward-looking regulatory framework.
According to him, the last edition of the FX manual was issued in 2018, making the latest review both timely and necessary.
Mr Cardoso disclosed that Nigeria’s foreign exchange market has witnessed significant improvement in liquidity since the current administration began reforms in the sector.
He added that daily turnover in the FX market increased from an average of about $100 million in the early days of the administration to between $400 million and $600 million daily.
The CBN Governor added that the market had also recorded transactions of up to $1 billion per day on several occasions in recent months.
“We have gone from a situation where it was more or less a one-way market, where the central bank came in, intervened and went away, to a much more dynamic market,” he stated.
The apex bank boss noted that the reforms were gradually restoring confidence among investors and market participants, encouraging freer entry and exit in the market without unnecessary restrictions.
He also maintained that the nation’s foreign reserves should not be used as the primary tool for funding the foreign exchange market.
“Reserves are reserves. They are not what you look to fund a market,” he said.
The CBN Governor assured stakeholders that the revised manual would be distributed free of charge to authorised dealers while the bank strengthens monitoring mechanisms to ensure compliance, fairness and accountability across the foreign exchange market.
On his part, the Deputy Governor for Economic Policy, Mr Muhammad Abdullahi, said the review formed part of broader reforms initiated by Mr Cardoso to restore confidence, improve transparency and deepen liquidity in the foreign exchange market.
Mr Abdullahi explained that the revised manual introduces several changes aimed at improving ease of doing business and reducing transaction bottlenecks.
Among the notable changes, he noted, are provisions allowing unfettered access to export proceeds, the introduction of non-resident investment accounts and operational guidelines for Pan-African Payment and Settlement System (PAPSS) transactions to support regional trade.
Mr Abdullahi added that the manual also contains new provisions on service exports, revised documentation requirements and updated operational procedures designed to align Nigeria’s FX market with global standards.
He said the apex bank deliberately adopted an ease of doing business approach during the review process to eliminate inefficiencies and ambiguities identified by stakeholders.
“The revised manual is not a stand-alone exercise but part of a broader institutional reform effort designed to strengthen the integrity, credibility and effectiveness of Nigeria’s foreign exchange system,” he said.
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