Zenith Bank Plc has assured shareholders and the investing public that it will fully exit the regulatory forbearance arrangements granted by the Central Bank of Nigeria (CBN) by the end of the first half of 2025.
The tier-1 lender expressed optimism that it will resume dividend payments in the current financial year following significant progress in meeting capital and credit-related requirements.
In a statement released on Monday, the bank clarified its position in response to a recent CBN circular on regulatory forbearance concerning Single Obligor Limits (SOL) and other credit facilities.
“The bank has successfully raised and surpassed the new regulatory capital requirement of N500 billion,” said Michael Otu, Company Secretary. “Our exposure under the SOL forbearance relates solely to a single obligor, and we are confident this will be brought within the regulatory limit on or before June 30, 2025.”
Otu further disclosed that the bank’s forbearance on other credit facilities involves only two customers. He noted that Zenith Bank has made “substantial provisions” for the facilities and has taken “comprehensive steps” to achieve full provisioning by the end of June.
“Upon completion, the bank will no longer be under any forbearance arrangements in this regard. Accordingly, we remain confident that the bank will satisfy all relevant conditions to enable it pay dividends to shareholders in the current year,” the statement read.
Zenith Bank’s clarification comes amid growing scrutiny of Nigerian banks’ exposure to regulatory forbearance measures. A recent report by Renaissance Capital identified Zenith Bank, FirstBank, and Access Bank as the most heavily exposed to CBN’s forbearance regime. According to the report, Zenith Bank’s forbearance-related loan exposures account for 23% of its loan book, compared to 14% for FirstBank and 4 per cent for Access Bank.
RenCap explained that these forbearance arrangements were introduced to provide temporary relief to banks dealing with large, stressed loan exposures—particularly in the oil and gas sector—and typically relate to breaches such as surpassing lending limits or capital shortfalls.
The investment firm projected that, due to the scale of these exposures and the provisioning required, the affected banks may not resume normal dividend payments until 2028.
“In our view, dividend payments from the core banking operations of Zenith, FirstBank, and Access will remain on hold until these institutions fully absorb their forbearance-linked risks,” the report said.
However, Zenith Bank’s latest statement signals a more optimistic timeline, as it seeks to restore investor confidence and re-establish its dividend-paying credentials in 2025.
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