Renaissance Capital reports, Zenith Bank, FBN Holdings and Access Bank lead with $3.52 billion in forbearance loans, as the Central Bank of Nigeria plans to phase out regulatory forbearance.
The report, titled “Phasing Out Regulatory Forbearances–Exploring Scenarios,” estimates Zenith’s exposure at $910 million, FBN Holdings at $848 million, and Access Bank at $535 million. The CBN’s gradual phase-out aims to strengthen banks’ capital bases while minimizing disruptions. The regulator has directed affected banks to suspend dividend payments and foreign investments.
FBN Holdings’ significant exposure includes loans to Aiteo Group, which has met interest payments recently, signaling improved cash flow. Zenith has provisioned 20% of its forbearance loans, while GTCO has covered 80%, with plans to write off the rest via equity. The CBN’s move follows a review of banks’ capital adequacy during a recent Eurobond roadshow.
The phase-out, expected to conclude by December 2025, will push banks to resolve non-performing loans. Experts note that proactive provisioning and improving borrower conditions in sectors like oil and gas may ease the transition, ensuring stability in Nigeria’s banking sector.
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