SEC issues framework on banking sector recapitalisation

In a bid to support the Central Bank of Nigeria’s recapitalisation programme towards achieving the targeted objectives, the Securities and Exchange Commission (SEC) has released its Framework on Banking Sector Capitalisation Programme, 2024.

The framework which was released on the Commission’s website on Friday serves as a comprehensive guide for Banks/Holding Companies and market participants to navigate the recapitalisation programme effectively.

The move is driven by the recent directive by the Central Bank of Nigeria for banks to raise additional capital to serve the $1 trillion economy.

The Commission said the framework would help to ensure that the capital raising process is conducted efficiently, transparently, and in a manner that protects the interests of all stakeholders.

According to SEC, “Following prevailing macroeconomic challenges and headwinds occasioned by external and domestic shocks, the Central Bank of Nigeria (CBN) has mandated a recapitalisation programme for banks to strengthen their asset base and support economic growth in line with the Federal Government’s target of achieving a $1 trillion economy by 2030.

“Capital market has a significant role to play in facilitating the recapitalisation programme as the Banks are expected to leverage the market to raise the needed funds and /or engage in various forms of business combinations.”

The SEC stated that applications/documents are filed electronically, adding that documents forwarded would be reviewed, “and where there are observed deficiencies, this will be communicated to the applicants electronically.”

“Where an application is returned for being incomplete – a penalty of N1, 000,000 and re-filing fee of N100, 000 shall apply. This fee is payable by the Issuing House without a recourse to the Issuer or the Issue proceeds. For further inquiries or clarification, banks and stakeholders are encouraged to contact the SEC’s dedicated offer application email: [email protected].”