CBN halts banks’ dividend payments, bonuses, foreign investments amid regulatory review

The Central Bank of Nigeria (CBN) has directed banks to temporarily suspend the payment of dividends to shareholders, defer the payment of bonuses to directors and senior management staff, and refrain from making investments in foreign subsidiaries or embarking on new offshore ventures.

This directive was conveyed in a circular with reference number BSD/DIR/CON/LAB/018/008 dated June 13, 2025, and titled “Letter to All Banks: Temporary Suspension of Dividend Payments, Bonuses and Investment in Foreign Subsidiaries.”

The document was signed by Olubukola A. Akinwunmi, director of the Banking Supervision Department of the CBN.

According to the apex bank, the measure forms part of ongoing efforts to strengthen the resilience and stability of the Nigerian banking sector. The CBN noted that it had recently reviewed the capital positions and adequacy of provisioning of banks currently operating under approved regulatory forbearance frameworks, particularly concerning credit exposures and Single Obligor Limits (SOL).

Given the imperative to bolster capital buffers, reinforce balance sheet resilience, and encourage prudent internal capital retention during this transitional period, the CBN has issued this directive to all banks that are currently beneficiaries of credit or SOL forbearance regimes.

The suspension will remain in force until the concerned banks have completely exited the forbearance arrangement and their capital adequacy and provisioning levels have been independently assessed and confirmed to be fully compliant with applicable regulatory standards.

The CBN explained that this supervisory intervention is designed to ensure that banks retain sufficient internal resources to meet both current and anticipated obligations, while also supporting the orderly restoration of sound prudential practices within the sector.

The central bank further stated that it will continue to monitor developments closely and will engage with financial institutions as necessary throughout this period. Affected banks are expected to fully comply with the directive and uphold prudent capital management principles. The circular concludes with the instruction, “Please be guided accordingly.”