Categories: Nigeria News

Zenith Bank in trouble as Capital Adequacy Ratio falls below mandated threshold

Zenith Bank Plc is facing additional challenges in the wake of its failure to meet the required Capital Adequacy Ratio (CAR).

Concerns are intensifying within the financial sector, as recent findings from a stress test conducted by the Central Bank of Nigeria (CBN) reveal that GTBank, along with seven other prominent Nigerian banks—Access Bank Plc, Fidelity Bank Plc, First City Monument Bank Limited, First Bank of Nigeria Limited, Union Bank of Nigeria Plc, United Bank for Africa Plc, and Zenith Bank Plc—have also fallen short of the mandated CAR.

This revelation coincides with the CBN’s contemplation of a potential new round of bank recapitalization, a matter previously reported

Notably, in September 2021, the CBN had issued guidelines stipulating a prudential Capital Adequacy Ratio of 10 percent for National and Regional Banks, while banks with international authorization were obligated to maintain a 15 percent regulatory Capital Adequacy Ratio.

The recent report underscores a significant decline in the overall Capital Adequacy Ratio of the banking system, dropping by 3.0 percentage points to 11.2 percent. This figure falls notably below the mandated 15.0 percent threshold set for banks with international authorization.

The downward trend is attributed to the CBN’s review of foreign exchange policies, which initiated the devaluation of the Naira starting from June 14, 2023. GTBank’s failure to meet the CAR requirements adds another layer of complexity to the challenges faced by the bank and emphasizes the urgency for corrective actions to restore confidence in the stability of the Nigerian banking sector.

Treasure Orokpo

A multi-talented individual with a passion for diverse fields, Treasure Orokpo is a trained journalist, skilled cook, and AI enthusiast. When she's not uncovering the latest stories, you can find her whipping up culinary creations in the kitchen and entertainment.

Recent Posts

Soaring rice prices threaten Christmas celebrations for Nigerian families

Rice, a staple for Christmas celebrations in Nigeria, has become a luxury this year. Soaring…

22 hours ago

Panic as Stage collapses during Odumodublvck’s performance at Lagos concert

Panic erupted on Saturday at a concert in Lagos when the stage collapsed during Odumodublvck’s…

22 hours ago

2025 Budget: FG allocates ₦6.36bn for renovation of Tinubu, Shettima’s official quarters

The Federal Government of Nigeria has allocated ₦6,364,181,224 billion for the refurbishment and rehabilitation of…

22 hours ago

Black Market Dollar to Naira Exchange Rate Today 22nd December 2024

The black market dollar to naira exchange rate for today, 22nd December 2024, can be…

22 hours ago

NNPC debunks shutdown rumors, confirms fuel loading at Port Harcourt Refinery

The Nigerian National Petroleum Company Limited (NNPCL) has refuted claims that the 60,000 barrels per…

22 hours ago

‘We have to find a way’ – Guardiola laments after defeat to Aston Villa

Manchester City finds itself in unprecedented turmoil, with relegation-level form showing little sign of improvement.…

23 hours ago