The Central Bank of Nigeria (CBN) has licensed two new commercial banks and one non-interest bank, the apex bank announced yesterday.

A list of deposit money banks (DMBs) and financial holding companies operating in the country as at July 19, 2019, posted on its website yesterday shows that CBN had issued a commercial banking licence with national authorisation and a commercial banking licence with regional authorisation to Titan Trust Bank Limited and Globus Bank Limited respectively.

The list also indicates that the regulator has issued a Non-Interest Banking licence with regional authorisation to TAJ Bank Limited.

With this development, the number of commercial banks with national authorisation (having a capital base of N25 billion and allowed to operate in all states of the federation but barred from having off shore operations) now stands at 11, while the number of commercial banks with regional authorisation (having a capital base of N10 billion and restricted to operate within a geographical scope of a minimum of five and a maximum of 10 contiguous states) now stands at three.

Similarly, the licensing of TAJ Bank Limited as a non-interest bank with regional authorisation means that there are now two non-interest banks operating in the country. However, the first such bank licensed by the CBN, Jaiz Bank, has a national authorisation, meaning it can operate in all states of the federation.

The CBN had in June 2011 announced a minimum capital base of N10 billion for national Islamic banks and N5 billion for regional Islamic banks.

Specifically, the list shows that the country now has a total of 29 DMBs consisting of eight commercial banks with international banking authorisation (N50 billion capital base and allowed to have national and off-shore operations), 11 commercial banks with national authorisation, three commercial banks with regional authorisation, two non-interest banks and five merchant banks with national authorisation.

According to the list, FBN Holdings Plc., FCMB Group Plc, FSDH Holding Company and Stanbic IBTC Holdings Plc make up the four holding companies in the industry.

There is speculation that the licensing of the new banks is part of CBN’s efforts to attract new investments into the industry and boost financial inclusion in the country.

However, analysts point out that the industry is dominated by Tier 1 lenders– First Bank, UBA, Guaranty Trust Bank, Access Bank and Zenith Bank – which continue to dominate in terms of branch spread, deposit size, and loan issuance.

Besides, the recent announcement by the CBN Governor, Mr. Godwin Emefiele, that the apex bank was planning a fresh recapitilisation of the banks has sparked speculation that consolidation is looming in the industry. (New Telegraph)