The Central Bank of Nigeria has released a fresh exposure draft introducing major changes to the licensing and regulation framework for Financial Holding Companies (HoldCos), a move that could significantly alter how banking groups are structured, capitalised and governed across the country. The proposed guidelines, issued on June 10, 2026 and open for public consultation until July 9, 2026, aim to close long-standing gaps identified in the 2014 framework, including uneven compliance, rising overhead costs and blurred governance boundaries within financial groups.

The updated framework represents one of the most far-reaching regulatory overhauls in Nigeria’s financial services sector in over a decade, with implications for capital requirements, cross-border ownership structures, intra-group financing and board composition across banking conglomerates.

Brandspur Banking News Desk gathered that the CBN’s review is designed to restore clearer separation between HoldCos and their subsidiaries, after concerns that some groups had been indirectly extending operational control into regulated entities beyond what the original structure permitted.

Under the proposed rules, all foreign subsidiaries within financial groups must now be held directly by the HoldCo or through a single intermediate HoldCo, with a strict limit of two ownership layers. Any structure beyond this will require special approval from the apex bank, a change that could force several Pan-African banking groups to reorganise their offshore holdings.

The draft also introduces a new capital framework requiring HoldCos to maintain at least 20% more regulatory capital than the combined minimum capital of all subsidiaries, with only paid-up capital and share premium recognised for compliance. Retained earnings and other equity components will no longer qualify, while surplus capital in one subsidiary cannot offset deficits in another, effectively tightening group-wide capital flexibility.

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In a significant shift to cost and governance structures, the CBN is also restricting shared services within financial groups. HoldCos will now only be permitted to provide facilities management, legal services and ICT support, and even these will require prior approval. Core functions such as risk management, compliance, internal audit and company secretariat services must be independently established within each subsidiary, a move expected to raise operating costs across banking groups.

Governance rules have also been tightened, with directors of a HoldCo limited to serving on only one subsidiary board, while no HoldCo staff member can sit as a non-executive director within the group. The regulator has further capped HoldCo representation on subsidiary boards at 20%, while also banning cross-attendance at board and management meetings, in a bid to prevent indirect control mechanisms across group structures.

The draft further targets intra-group lending practices, classifying loans from banking subsidiaries to their parent HoldCo as capital deductions in Capital Adequacy Ratio calculations. Such exposures will be treated as returns of capital, while loans to affiliates will attract full capital deductions if unsecured and 100% risk weighting even when secured. HoldCos are also barred from relying on subsidiary guarantees for borrowing, except where backed by dividend income or service agreements.

On entry requirements, the CBN has increased licensing thresholds, setting a non-refundable ₦20 million fee for Approval-in-Principle and ₦100 million for final licensing. Non-bank promoters will also be required to deposit 100% of the combined minimum capital of proposed subsidiaries plus a 20% buffer with the CBN before approval is granted, significantly raising the barrier to entry for new HoldCo structures.

The proposed reforms are expected to trigger extensive restructuring across Nigerian banking groups, particularly those with complex Pan-African footprints, as well as potential fresh capital raises to meet the stricter capital buffers. Industry analysts anticipate increased compliance costs, possible consolidation among smaller subsidiaries, and a stronger push toward clearer separation between ownership and operational control within financial conglomerates.