The Central Bank of Nigeria (CBN) has released its annual report, detailing the impact of Olayemi Cardoso’s banking reforms one year into his tenure. The reforms prioritize risk-based supervision and a proactive approach to financial stability, moving away from reactive measures. Key actions include the ongoing bank recapitalization exercise, stricter foreign exchange risk monitoring, and updated liquidity management frameworks.

Stress tests conducted by the CBN on 34 banks revealed that while the industry maintains adequate buffers to survive moderate economic shocks, it remains vulnerable to severe, prolonged crises. Specifically, banks face structural risks due to high credit concentration in the oil and gas sector and fragile capital adequacy ratios. The report also highlights a significant reduction in interbank exposure and the introduction of climate-risk assessments, marking a shift toward more comprehensive oversight of systemic risks.