In a decisive move aimed at protecting the integrity of Nigeria’s financial system, the Central Bank of Nigeria (CBN) has drawn a clear line: banks currently enjoying regulatory forbearance must hold off on rewarding themselves and their investors.
Dividend payments to shareholders and bonuses to directors and senior management have officially been suspended for these institutions, pending a full cleanup of their books.
On June 13, the CBN issued a circular signed by Olubukola Akinwunmi, its Director of Banking Supervision, informing affected banks of the new directive.
The message was straightforward. Banks under regulatory forbearance must suspend dividend payments and bonuses.
But what does all this mean for the average Nigerian, and why is it happening now?
What Is Regulatory Forbearance?
When banks run into financial trouble—perhaps due to bad loans, poor investment decisions, or economic shocks—the CBN sometimes offers temporary relief. This includes relaxing certain regulatory requirements like credit exposure limits and the Single Obligor Limit (SOL), which restricts how much a bank can lend to a single borrower.
It’s essentially a breathing space—an opportunity for banks to recover without being penalized too quickly.
Some banks, despite struggling behind the scenes, kept distributing profits as if all was well. Now, the CBN is stepping in with a loud message:
“No bonuses. No dividends. Not until your books are clean and your capital strong.”
Why Is the CBN Doing This Now?

There are three big reasons driving this decision:
- The Economy Is Shaky—and So Are Some Banks
Nigeria’s economy has taken a beating: high inflation, a volatile naira, and global uncertainty.
Some banks are quietly absorbing losses or carrying bad loans, especially from risky lending in oil, gas, or FX exposures.
This move ensures that instead of rewarding shareholders or executives, banks focus on survival and recovery.
- Past Mistakes Are Echoing
The 2009 banking crisis is still fresh in the minds of regulators. Back then, it took billions in bailouts to save the system. The CBN clearly doesn’t want history to repeat itself—and is applying pressure early to stop the rot. - Forbearance Is Not a Party Pass
The forbearance relief was never meant to be a party pass. It was supposed to help banks fix themselves, not keep up appearances while handing out rewards. Now, the CBN is holding everyone accountable. So What Exactly Has Been Suspended?
According to the CBN:
“As part of this review, the CBN directed affected banks to suspend dividend payments, defer bonuses, and refrain from making investments in foreign subsidiaries or launching new offshore ventures.”
If a bank is on regulatory life support, it must stop trying to expand abroad, stop promising returns to shareholders, and stop giving perks to top brass—until it’s financially sound again.
“This temporary suspension is until such a time as the regulatory forbearance is fully exited and the banks’ capital adequacy and provisioning levels are independently verified to be fully compliant with prevailing standards.”
What Does It Mean for the Average Nigerian?

Firstly, Your Money Is Safer
If you bank with one of these institutions, this directive is a form of protection. It forces banks to hold on to their cash reserves and rebuild stability, which means your deposits are less likely to vanish in a crisis.
Banks Will Lend More Responsibly
In the past, some banks gave out reckless loans and hoped the profits would cover the fallout. Now, tighter oversight could lead to smarter lending practices—which is great for small businesses and startups looking for clean capital.
You Avoid Future Bailouts
When banks collapse, the public ends up footing the bill—whether through taxpayer-funded bailouts or lost savings. This move reduces that risk by holding financial institutions accountable before it’s too late.
This isn’t happening in isolation. It comes in the wake of new recapitalisation directives and a fresh wave of reforms aimed at cleaning up Nigeria’s banking sector.
By enforcing this pause, the CBN is setting the tone: discipline now, dividends later.
“The measure is to ensure that internal resources are retained to meet existing and future obligations and support the orderly restoration of sound prudential positions,” the CBN said.
Banks must be strong before they can be generous.
To the big banks, this may feel like tough love. But to the average Nigerian, this is a quiet act of protection. It’s the kind of move that doesn’t make noise on social media but could save your finances tomorrow.
The CBN has made it clear: There’s no reward without responsibility.
And in a country where banking stability means food on the table, salaries on time, and businesses afloat—that’s a stance we should all care about.
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