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The Central Bank of Nigeria (CBN) has granted JPMorgan approval-in-principle to establish a merchant bank in Nigeria, marking a significant step towards the expansion of the international financial institution’s operations in the country.
The proposed institution, to be known as JPMorgan Merchant Bank Nigeria Limited, is expected to operate within Nigeria’s corporate banking, investment banking and capital markets segments, subject to the completion of the remaining regulatory requirements.
The approval comes amid ongoing efforts by the apex bank to strengthen the country’s financial system, improve investor confidence and attract international investment into the Nigerian economy.
Approval not final operating licence
The CBN clarified that the approval-in-principle represents an initial stage in the licensing process and does not authorise the proposed merchant bank to commence operations.
JPMorgan Merchant Bank Nigeria Limited must satisfy all outstanding regulatory conditions and obtain a final banking licence from the apex bank before it can begin business.
The proposed institution is also required to complete its incorporation with the Corporate Affairs Commission and put the necessary operational and regulatory arrangements in place.
The CBN’s Director of Corporate Communications and Investor Relations, Michael Akuka, said the decision reflected the regulator’s commitment to strengthening financial stability, improving market confidence and deepening Nigeria’s integration with global capital markets.
Akuka added that the approval followed the completion of the banking sector recapitalisation exercise, which was designed to strengthen the resilience and capacity of Nigerian banks.
He stressed that the approval-in-principle did not exempt JPMorgan from fulfilling the remaining conditions required for the issuance of a final operating licence.
Cardoso welcomes international interest
CBN Governor Olayemi Cardoso said the regulator was working towards building a stable, competitive and internationally connected financial system capable of supporting investment and economic growth.
Cardoso welcomed the growing interest of international financial institutions in Nigeria, noting that the central bank would continue to pursue reforms aimed at strengthening market credibility and creating an environment in which domestic and foreign financial institutions could operate.
The development is expected to introduce additional competition into Nigeria’s merchant banking market, particularly in areas involving corporate finance, investment banking and capital markets services.
The entry of another major international financial institution could also broaden the range of financial services available to businesses and investors, although the scale of its eventual operations will depend on the scope of its licence and its business strategy.
CBN approves management team
Alongside the approval-in-principle, the CBN approved the nomination of Adedapo Adedayo Olagunju as managing director of the proposed merchant bank.
The apex bank also approved Latter Kevin George, Nzelu Chinedum Izunwanne and Syed Gabriel Murtaza as non-executive directors.
Alade Sarah Omotunde, Ajayi Olukonyinsola and Adetu Seni were approved as independent non-executive directors.
The appointments form part of the proposed bank’s leadership structure as it progresses through the licensing process.
However, the bank must still meet the applicable regulatory and operational conditions before it can begin offering services to customers in Nigeria.
N50bn deposit reported
JPMorgan Chase & Co. had earlier reportedly deposited N50 billion, equivalent to approximately $38 million, with the CBN as part of its application to establish a merchant bank in Nigeria.
The deposit was reported to be connected with the capital requirement applicable to a nationally licensed merchant bank and represented a significant step towards establishing the proposed operation.
Reports had also indicated that JPMorgan expected to secure the licence by the end of 2026 or early 2027, subject to the CBN’s assessment and final authorisation.
The approval-in-principle advances the proposed bank’s licensing process but does not guarantee that it will commence operations within that projected timeframe.
JPMorgan will need to complete the outstanding requirements and obtain the CBN’s final approval before beginning business.
The development comes as Nigeria continues efforts to strengthen its financial sector, improve access to investment and reinforce links between its domestic markets and the international financial system.
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