By AYOOLA OLAOLUWA
Nigeria’s banking sector has reasserted itself as the primary gateway for foreign capital, with inflows into the sector rising by 93.25 per cent to $13.53 billion in 2025.
This surge is closely tied to the Central Bank of Nigeria’s recapitalisation policy, which has reshaped investor perception of the sector.
According to figures from the National Bureau of Statistics (NBS) capital importation report seen by Business Hallmark, the banking sector remained the largest recipient of foreign capital, accounting for $13.53 billion out of the total $23.22 billion inflows in 2025. This represents 58.26 per cent of total capital importation, up from 56.81 per cent in the previous year.
The sharp increase reflects strong investor appetite for Nigerian banks amid efforts to raise fresh capital to meet new regulatory thresholds set by the apex bank. Recapitalisation activities across the industry drove significant inflows throughout the year.
Quarterly analysis indicates sustained momentum. Inflows stood at $3.13 billion in the first quarter, up 51.3 per cent from $2.07 billion in Q1 2024. The second quarter recorded a surge to $3.41 billion, marking a 203.2 per cent increase from $1.12 billion in the same period of 2024.
In the third quarter, inflows rose sharply by 442.2 per cent to $3.14 billion from $579.48 million, while the fourth quarter posted $3.85 billion, representing a 19.2 per cent increase from $3.23 billion in Q4 2024.
The banking sector maintained its dominance in capital importation across all quarters, accounting for 55.44 per cent in Q1, 66.56 per cent in Q2, 52.25 per cent in Q3, and 59.75 per cent in Q4. This compares with 61.24 per cent, 43.15 per cent, 46.26 per cent, and 63.46 per cent recorded in the corresponding quarters of 2024.
In contrast, capital inflows into equities declined by 16.8 per cent to $271.42 million in 2025, down from $326.04 million in 2024. While the first quarter saw a modest rise to $115.26 million, subsequent quarters recorded mixed performance, ending with a sharp drop to $27.79 million in Q4 from $105.57 million a year earlier.
Financing-related inflows, however, recorded significant growth, rising by 424.9 per cent to $6.77 billion from $1.29 billion in 2024. The increase was driven by strong performances across all quarters, particularly in Q1 and Q3.
Overall, total capital importation into Nigeria climbed by 88.5 per cent to $23.22 billion in 2025, compared to $12.32 billion in the previous year, with growth recorded across all four quarters.
The data underscore the banking sector’s central role in attracting foreign investment and driving overall capital inflows, supported by regulatory reforms and improved market sentiment.
CBN Governor, Olayemi Cardoso, recently disclosed that 32 banks have met the new capital requirements under the ongoing recapitalisation programme ahead of the March 31, 2026 deadline.
According to him, the progress recorded so far has strengthened the resilience of the banking system and enhanced its capacity to mobilise long-term capital, support productive investment, and contribute to Nigeria’s ambition of building a $1 trillion economy.
The apex bank also revealed that Nigerian banks have raised a total of N4.61 trillion under the recapitalisation programme, with 27 per cent of the funds sourced from foreign investors.
Speaking on the development, an economist, Dr. Peju Beckley, said that by accounting for over 58 per cent of total capital importation, banks have not only retained dominance but deepened their strategic importance within the financial system.
“The data reflect more than cyclical growth—they signal a structural shift. Investors appear to be responding positively to regulatory clarity, stronger capital buffers, and the prospect of a more resilient banking industry.
“However, the uneven performance across asset classes—particularly the decline in equity inflows—suggests that confidence remains concentrated rather than broad-based.
“The sharp rise in financing inflows also indicates increased reliance on debt-linked instruments, raising questions about sustainability and long-term capital quality.
“While the recapitalisation programme has undeniably strengthened the sector’s capacity to mobilise funds, policymakers must ensure that this influx translates into real economic expansion, particularly in credit access to productive sectors.
“Ultimately, the success of this reform will be measured not just by capital raised, but by its impact on growth, financial inclusion, and economic diversification”, Beckley said.