Regulatory Alerts2021-09-03 | BSD/DIR/PUB/14/063Guidelines on Regulatory Capital
The Central Bank of Nigeria (CBN) has released guidelines for regulatory capital to enhance the resilience of Deposit Money Banks (DMBs) and the Nigerian banking system. The guidelines outline the criteria for banks' capital instruments to be eligible for regulatory purposes, including minimum regulatory capital, adjustments, transitional arrangements, disclosure requirements, and additional capital buffers. Banks are required to maintain minimum capital and capital buffer requirements at both stand-alone and consolidated levels, with specific reporting frequencies. The CBN may request banks to calculate and report capital adequacy ratios for any financial period. The guidelines also detail the components of regulatory capital, including Common Equity Tier 1 (CET1), Additional Tier 1, and Tier 2 Capital. The CBN may require banks to maintain higher minimum capital levels based on their risk profiles. The guidelines include tables illustrating minimum capital requirements and buffer levels for different types of banks.