(Bloomberg) -- Nigerian lenders shrugged off a 10-fold increase in capital requirements imposed on them by the central bank and said the industry had plenty of time to adapt.

“The extended timeline until 2026 provides ample opportunity for each bank to follow through its recapitalisation plan,” ACAMB, an umbrella body that speaks for Nigerian lenders, said in a statement Tuesday following the March 28 announcement of the rules.

“The Nigerian capital market, where banks are the most influential group, has the depth to meet the capital requirements,” it said.

The NGX Banking Index, which measures the nation’s biggest lenders, rose 0.6% to 1,035.82 in Lagos trading as of 1:50 p.m. in Lagos. The industry has gained about 15% this year, compared with a 40% advance by the broader NGX All Share Index.


Nigeria’s central bank last week increased the minimum capital requirements for operating an international bank to 500 billion naira ($382 million) from 50 billion naira previously, and ordered lenders with in-country operations to raise 200 billion naira from 25 billion naira. Banks have two years to comply.

BancTrust & Co. Investment Bank analysts said the change would see Nigeria’s top commercial lenders raise about 2.8 trillion naira.

The Central Bank of Nigeria said the much tougher requirements aim to strengthen the industry’s loss-absorbing buffers in the face of a steep naira devaluation, high inflation and weak economic growth.

Attractive Pricing

“We expect to see a lot of offers this year,” said Ayo Ebo, managing director at Optimus by Afrinvest. “Banks will have to offer attractive pricing to garner investors interest,” he said.

The move is the latest measure by the central bank to improve the economy’s resilience, after sweeping reforms last year aimed at boosting growth and luring more foreign capital.

The steps, which scrapped subsidies on fuel and eased foreign-exchange controls, have seen the naira shed 65% of its value against the dollar, pushing inflation to a 28-year high of 31.7% in February and spawning a cost-of-living crisis.

The collapse in the currency and rising interest rates on dollar loans has inflicted losses on Nigerian companies, including its banks, and the CBN last year told lenders to save any currency-linked gains to help guard against the risk of an increase in bad debts.

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