Fidelity Bank and FirstHoldCo Plc have both confirmed plans to fully exit the Central Bank of Nigeria’s (CBN) regulatory forbearance framework in 2025.
Their separate announcements mark a key development in Nigeria’s banking sector, which has come under heightened regulatory scrutiny over capital adequacy and compliance amid new prudential directives by the CBN.
Fidelity Bank Targets Full Compliance by H1 2025
Fidelity Bank announced on Wednesday its commitment to exit CBN’s forbearance arrangements by the end of the first half of 2025, a move that would restore its capacity to pay dividends and resume other discretionary spending. According to a statement signed by the bank’s Company Secretary, Ezinwa Unuigboje, the forbearance linked to a breach of the Single Obligor Limit (SOL) is tied to two obligors. The bank expressed confidence that the exposures will be brought within regulatory thresholds by June 2025.
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The lender also revealed that it is managing four other credit facilities currently under forbearance. The bank said it has made significant provisioning on those accounts and is working towards either full provisioning or returning the loans to performing status by the middle of 2025.
“Fidelity Bank remains committed to strict compliance with all regulatory policies, including the recent CBN directive on forbearance. We have proactively made substantial provisions on affected facilities and taken targeted steps to resolve the exposures,” the statement said.
To strengthen its capital base and meet the CBN’s N500 billion minimum capital requirement for banks with international authorization, Fidelity Bank disclosed that it has successfully raised N273 billion through an oversubscribed Public Offer and Rights Issue. The public offer recorded a 237.92% subscription, while the rights issue was oversubscribed by 137.73%.
In addition, the bank is planning to raise another N200 billion through a private placement in the 2025 financial year. It confirmed that CBN and shareholder approvals for the private placement have already been secured, with other regulatory clearances underway to ensure completion.
Fidelity Bank emphasized that the capital raising efforts and planned exit from forbearance will position it for dividend resumption in the 2025 financial year.
“We remain in a strong position to meet all regulatory expectations to enable dividend payments going forward,” the bank stated.
FirstHoldCo Moves to Resolve SOL Breach and Loan Forbearance
Similarly, FirstHoldCo Plc disclosed on Thursday that its banking subsidiary, FirstBank, is working to resolve breaches of the Single Obligor Limit stemming from two foreign currency loan exposures. The loans were affected by the over 200% naira devaluation that occurred between 2023 and 2024, pushing the exposures above regulatory limits.
The firm explained that the affected loans are part of syndicated credit facilities with industry-wide exposure and that all the underlying assets are now back in active production and generating revenue. Some of the projects are also awaiting receivables from government agencies.
“The syndicate is actively restructuring and re-tenoring the loans based on improved cash flows. The process is expected to be completed within the current financial year,” the statement said.
Should the restructuring fail to be completed in time, FirstHoldCo assured that it would make full provisioning on the remaining facilities to ensure a clean exit from forbearance and resume dividend payments in 2025.
In parallel, FirstHoldCo is undertaking its own capital raise scheduled for the second half of 2025, reinforcing its long-term commitment to balance sheet stability and regulatory compliance.
CBN Forbearance Framework and Sector-Wide Impact
These developments come in response to the CBN’s directive earlier this year that banks under regulatory forbearance must suspend dividend payments, defer executive bonuses, and halt foreign investments. The central bank’s new rules aim to improve capital buffers, encourage prudent risk management, and ensure that banks under financial stress are not distributing value to shareholders or engaging in expansionary activity.
The forbearance framework primarily applies to banks with unresolved breaches of lending concentration rules (such as SOL breaches) and non-performing credit exposures that require exceptional regulatory tolerance.
Both Fidelity Bank and FirstHoldCo appear determined to resolve their exposures and exit the CBN’s list of forbearance beneficiaries. Their capital-raising efforts and transparent updates to shareholders indicate an industry-wide effort to regain regulatory confidence and reposition for long-term stability.
What This Means for Investors
Investors in Fidelity Bank and FirstHoldCo can take some assurance in the clear timelines provided for resolving outstanding issues and the strong commitment to dividend resumption. Both banks have linked their strategic plans to the broader CBN agenda of deepening financial system resilience and curbing systemic risk.
If successfully executed, the exit from forbearance would allow both banks to restore their full standing in Nigeria’s capital markets and deliver on shareholder returns as early as the 2025 financial year.
More banks are expected to follow suit in reassessing their credit exposures, recapitalizing, and reestablishing dividend-paying capacity in line with evolving CBN’s regulatory standards.