Zenith Bank to Exit CBN Regulatory Forbearance by June 30, Targets Dividend Resumption
Zenith Bank set to end CBN forbearance, plans dividend comeback by mid-2025.
Lender meets capital target, moves to restore investor confidence and financial stability.
Zenith Bank Plc has announced that it will fully exit its regulatory forbearance arrangement with the Central Bank of Nigeria (CBN) by June 30, 2025, signaling its readiness to resume dividend payments and other capital-related activities.
This development was disclosed in a statement filed on the Nigerian Exchange Limited (NGX) on Wednesday. According to the statement signed by the bank’s company secretary, Michael Otu, Zenith Bank has surpassed the new N500 billion minimum capital requirement set by the apex bank.
Zenith was among several lenders affected by a recent CBN directive that temporarily restricted banks from paying dividends, issuing bonuses, or investing in foreign subsidiaries. These restrictions were tied to regulatory forbearance relating to breaches in the Single Obligor Limit (SOL) and other credit exposures.
In the filing, the bank clarified that its SOL exposure concerns just one obligor and that corrective measures are already in motion. “We are confident that this exposure will be brought within the applicable regulatory limit on or before 30 June 2025,” the bank stated.
Furthermore, Zenith Bank disclosed that the forbearance related to other credit facilities applies to only two customers, adding that significant provisions have already been made for these. The bank assured investors that full provisioning will be achieved before the end of June.
“Upon completion, the Bank will no longer be under any forbearance arrangements in this regard,” the statement read. “The Bank expects to have exited all CBN forbearance arrangements by the end of the first half of 2025.”
This signals a positive shift for the tier-one lender, which is aiming to return to dividend issuance in the current financial year. The bank reassured its shareholders that it is on track to meet the conditions necessary for capital distributions once the forbearance period lapses.
The CBN had earlier reiterated that its directive on capital restrictions applies only to a select number of banks and that the move was temporary. In a separate statement released Tuesday, the CBN, through its acting Director of Corporate Communications, Sidi Ali, clarified the objective behind the decision.
“These measures apply only to a limited number of banks and are temporary,” the CBN stated. “The restrictions on dividends and bonuses are meant to support the retention of earnings and improve capital adequacy.”
The CBN emphasized that affected banks have been officially notified and remain under active supervisory engagement to ensure compliance with regulatory expectations.
Zenith Bank’s proactive steps to address the CBN’s requirements, including raising capital above the new threshold and provisioning for non-performing credit, position it well to maintain investor confidence and financial stability in the coming quarters.
The announcement comes amid broader concerns in Nigeria’s banking sector about recapitalization, regulatory compliance, and the impact of tightened monetary policies. Market observers view Zenith’s exit from the forbearance arrangement as a significant step that could positively influence sentiment around banking stocks and signal resilience among top-tier institutions.
With the forbearance phase nearing its end and conditions improving, shareholders may soon see the return of dividends, while the bank continues to reinforce its capital base for future growth.
