CBN suspends dividends, bonuses, foreign investments for banks

By Seun Ibiyemi

The Central Bank of Nigeria (CBN) has instructed all banks to temporarily halt the payment of dividends to shareholders, postpone the disbursement of bonuses to directors and senior management, and suspend investments in foreign subsidiaries or the launch of new offshore ventures.

This directive was issued through a circular dated 13 June 2025, referenced BSD/DIR/CON/LAB/018/008, 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 CBN’s Banking Supervision Department.

According to the central bank, the move is part of a broader strategy aimed at reinforcing the resilience and long-term stability of Nigeria’s banking sector.

The CBN said it recently conducted a review of the capital positions and the adequacy of loan loss provisioning among banks operating under regulatory forbearance frameworks. This review focused on credit exposures and adherence to Single Obligor Limits (SOL).

In light of the need to strengthen capital buffers, fortify balance sheet resilience and promote responsible internal capital retention during this transitional period, the CBN has directed that all banks benefitting from credit or SOL forbearance must comply with the measures outlined.

The temporary suspension will remain in place until the affected banks have fully exited the forbearance arrangement and undergone independent assessments confirming their compliance with all relevant regulatory standards concerning capital adequacy and provisioning.

The CBN clarified that this supervisory step is intended to ensure banks preserve sufficient internal resources to meet both present and future obligations. It also aims to facilitate a structured return to robust prudential practices across the sector.

The central bank added that it will continue to closely observe the situation and maintain engagement with financial institutions throughout the duration of this directive. Banks are expected to adhere strictly to the instruction and uphold principles of sound capital management.

The circular concludes with a firm reminder: “Please be guided accordingly.”