Wednesday, September 17, 2025 - Nigeria’s major banks must get approval for new managing directors at least six months before their current chief executives leave office, the Central Bank of Nigeria has ordered.
The apex bank also said these appointments must be announced
publicly no later than three months before the outgoing managing director
officially steps down.
The new rules apply to Domestic Systemically Important Banks
(DSIBs) – the largest lenders that are considered “too big to fail” because of
their size and importance to Nigeria’s financial system.
The directive was contained in a circular signed by Dr Rita
Sike, Director of Financial Policy and Regulation, and published on the CBN’s
website on Tuesday.
“Consequently, and in line with good corporate governance
practice, each DSIB is hereby required to: ensure it obtains regulatory
approval for the appointment of a successor Managing Director not later than
six months to the expiration of the tenor of the incumbent MD/CEO,” the
circular stated.
Banks must also “publicly announce the appointment of the
successor MD/CEO not later than three months to the planned exit of the
incumbent MD/CEO.”
The CBN said the move is part of broader efforts to
strengthen corporate governance and maintain confidence in the financial
system. It warned that leadership uncertainty at large banks could destabilise
the entire financial sector and damage the wider economy.
The new rule draws from corporate governance guidelines
issued in 2023, which require commercial, merchant, non-interest, and payment
service banks to maintain strong succession plans for senior executives.
The policy “seeks to minimise disruptions at the top
management level, enable top management appointees to prepare adequately for
their new roles, and generally mitigate risks associated with abrupt changes in
leadership,” the central bank said.
DSIBs play an outsized role in Nigeria’s financial system
because of their scale, complexity, and connections with other institutions. A
shock at one of these banks could ripple across financial markets, affecting
depositors, shareholders, and the broader economy.
By tightening succession rules, the CBN aims to ensure
smoother leadership transitions and stronger institutional resilience. The
policy also aligns Nigeria more closely with international best practice, where
regulators emphasise succession planning as a critical element of risk
management.
The new directive follows several high-profile leadership
changes in Nigeria’s banking sector. Access Holdings recently confirmed
Innocent Ike as its managing director after securing regulatory approval,
following Roosevelt Ogbonna’s exit in line with governance rules.
The return of Aigboje Aig-Imoukhuede as chairman of Access
Holdings after the tragic death of former CEO Herbert Wigwe in 2024 highlighted
the importance of structured succession planning.
Under the new rules, DSIBs must begin succession planning
well in advance, secure CBN approval six months before a handover, and make
public announcements three months ahead. The timeline gives stakeholders –
including investors, customers, staff, and regulators – greater clarity about
leadership continuity.
Analysts say the measure is intended to reassure markets in
an economy often hit by shocks such as currency volatility, high inflation, and
rising interest rates. It could also reduce speculation and rumours over
executive exits, which have previously disrupted confidence and unsettled
investors.
The directive fits with the broader reform agenda of CBN
Governor Olayemi Cardoso, who has prioritised transparency, governance, and
resilience in the financial sector. The apex bank has introduced foreign
exchange reforms, tightened recapitalisation requirements, and rolled out other
policies to stabilise the industry.
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