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CBN Grants JPMorgan Approval to Establish Merchant Bank in Nigeria
CBN Grants JPMorgan Approval to Establish Merchant Bank in Nigeria
JPMorgan has received approval-in-principle to establish JPMorgan Merchant Bank Nigeria Limited, subject to further regulatory requirements.
The CBN has approved Adedapo Adedayo Olagunju as managing director and seven other nominees as directors.
The proposed bank must obtain a final licence from the CBN before commencing operations.
October 23, () – The Central Bank of Nigeria has granted JPMorgan approval-in-principle to establish a merchant bank in the country, marking a potential expansion of the global financial institution’s presence in Nigeria’s financial services market.
The proposed institution, JPMorgan Merchant Bank Nigeria Limited, will be able to commence operations only after satisfying the applicable regulatory requirements and obtaining a final banking licence from the CBN.
The approval was announced by Michael Akuka, Director of the CBN’s Corporate Communications and Investor Relations Department.
The development comes amid ongoing efforts by the apex bank to strengthen financial stability, deepen capital markets and improve confidence in Nigeria’s financial system.
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However, the approval-in-principle is an initial regulatory step, not a final operating licence.
The proposed bank must complete its incorporation with the Corporate Affairs Commission and fulfil the necessary operational and regulatory conditions before receiving authorisation to begin business.
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Adedapo Adedayo Olagunju, managing director of the proposed bank – Photo credit: JarusHub.
Board appointments approved
The CBN also approved the nomination of Adedapo Adedayo Olagunju as managing director of the proposed bank.
The approved non-executive directors are Latter Kevin George, Nzelu Chinedum Izunwanne and Syed Gabriel Murtaza.
The apex bank also approved Alade Sarah Omotunde, Ajayi Olukonyinsola and Adetu Seni as independent non-executive directors.
The appointments form part of the institutional arrangements for establishing the proposed merchant bank, although operations remain subject to the completion of the licensing process.
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A view of the exterior of the JP Morgan Chase & Co. corporate headquarters in New York City May 20, 2015. REUTERS/Mike Segar/Files
Financial sector reforms
The approval comes as the CBN pursues reforms aimed at strengthening the resilience of Nigeria’s banking system, including the banking sector recapitalisation exercise.
The exercise requires banks to meet higher minimum capital requirements, with the objective of strengthening their capacity to support lending, absorb financial shocks and finance economic activity.
The proposed entry of JPMorgan Merchant Bank Nigeria Limited could expand the range of institutions participating in Nigeria’s financial markets.
However, the approval alone does not establish the scale of its planned operations, its intended client base or the amount of capital it will deploy.
The CBN said its broader reform agenda is focused on building a stable, competitive and internationally connected financial system capable of supporting investment and economic growth.
The apex bank reaffirmed its commitment to strengthening market credibility and encouraging both domestic and international financial institutions to participate in Nigeria’s financial sector.
JPMorgan Merchant Bank Nigeria Limited will be able to commence operations only after the CBN issues its final licence.
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