JPMorgan Chase & Co., the largest bank in the United States by assets, has deposited N50 billion ($38 million) with the Central Bank of Nigeria (CBN) as it advances its application for a merchant banking licence in Nigeria.
According to Bloomberg, which cited people familiar with the matter, the deposit is one of the final regulatory requirements for obtaining approval and signals the lender’s readiness to commence merchant banking operations in the country.
The sources, who requested anonymity because the licensing process is private, said JPMorgan expects to secure the licence by the end of 2026 or early 2027, subject to regulatory approval.
- However, there is no guarantee that the application will be successful, as the CBN retains the final decision on whether to grant the licence.
- Under Nigerian banking regulations, prospective banks are required to place capital in a designated account with the central bank as part of the licensing process. The requirement is intended to demonstrate that applicants have sufficient funds to support their proposed operations.
- The development marks a significant step in JPMorgan’s efforts to expand its presence in Africa’s largest economy, where it is seeking to increase its exposure to trade finance, lending, payments and corporate banking.
The New York-based lender currently operates a representative office in Lagos, which provides a limited presence compared with a fully licensed banking operation.
JPMorgan strengthens African investment banking
The Nigerian licensing bid 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 bank has strengthened its investment banking leadership in sub-Saharan Africa in recent months, appointing Edward Bell to lead investment banking across the region.
- It has also appointed Sailepu Montet to head its Kenya office and Michael Ahonzo Avou to oversee operations in Ivory Coast.
These appointments reflect the lender’s efforts to expand its regional coverage and strengthen relationships with businesses, governments and institutional clients.
Broader platform to serve local corporates
Securing a Nigerian banking licence would provide JPMorgan with a broader platform to serve local corporates, facilitate cross-border transactions and expand its lending activities.
- Nigeria’s large economy and its role in regional trade make it an important market for international banks seeking to grow their African operations.
However, the planned expansion remains subject to the CBN’s final decision on the licence application.
JPMorgan seeks to expand Nigerian operations
JPMorgan plans to convert its longstanding Lagos representative office into a fully operational business branch, allowing it to broaden the range of services available to Nigerian corporate clients.
- Nairametrics reported last year that the bank was preparing to apply for a merchant banking licence from the CBN to expand its activities in the country.
- The proposed licence would allow JPMorgan to move beyond its existing advisory and asset management activities and introduce additional banking services, including dollar-denominated loans tailored to large corporations.
- The expansion would strengthen its ability to serve Nigerian businesses engaged in international trade and other transactions requiring access to foreign currency financing.
It would also position the lender to compete more directly for corporate banking business in a market where demand for foreign currency funding and international financial services remains significant.