JPMorgan Deposits N50 Billion With CBN in Major Step Toward Nigerian Merchant Banking Licence

JPMorgan Chase & Co. has deposited N50 billion (approximately $38 million) with the Central Bank of Nigeria (CBN), marking one of the final regulatory steps toward securing a merchant banking licence in Africa’s largest economy.

The deposit meets the minimum paid-up capital requirement for a nationally authorised merchant bank in Nigeria, which the CBN raised from N15 billion to N50 billion in March 2024 as part of a broader recapitalisation programme.

People familiar with the matter, who spoke on condition of anonymity because the process is private, said the payment signals the US lender’s readiness to launch a merchant banking operation should its application be approved.

JPMorgan expects to receive the licence by the end of 2026 or early 2027, subject to the CBN’s final decision, the sources said.

The bank declined to comment, while a CBN spokesman did not immediately respond to a request for comment.

The development follows remarks by Dapo Olagunju, managing director of JPMorgan West Africa, who revealed earlier this month during the Nigeria-Asia Financial Connectivity Dialogue in Singapore that the bank planned to establish a merchant banking subsidiary in the country.

JPMorgan currently operates only a representative office in Lagos, which provides a limited presence compared with a fully licensed banking operation.

A merchant banking licence would enable the lender to broaden its financial services in Nigeria, particularly in corporate banking, lending, trade finance and payments, and potentially offer dollar-denominated loans to large corporations.

Under Nigerian banking regulations, licence applicants must place capital in a designated account with the CBN as part of the approval process, demonstrating sufficient funds to support proposed operations.

Satisfying the capital requirement, however, does not automatically guarantee approval, as the regulator must still assess the company’s ownership, governance, business model, management, risk controls and operational readiness.

The move forms part of JPMorgan’s broader strategy to deepen its presence across Africa and capture a larger share of the continent’s growing corporate and investment banking opportunities.

The New York-based lender has strengthened its African investment banking leadership in recent months, appointing Edward Bell to lead investment banking across sub-Saharan Africa, Sailepu Montet to head its Kenya office and Michael Ahonzo Avou to oversee operations in Ivory Coast.

If approved, JPMorgan would rank among the biggest foreign banking institutions operating in Nigeria, expanding competition in corporate banking, trade finance, foreign-currency lending and cross-border payments.