• Largest US bank hopes to secure permit by end of 2026
Emmanuel Addeh in Abuja and Nume Ekeghe in Lagos
JPMorgan Chase, the largest bank in the United States, has deposited N50 billion with the Central Bank of Nigeria (CBN), advancing its bid to establish a locally licensed merchant banking operation in the country.
The deposit, equivalent to about $38 million, meets a key capital requirement for obtaining a merchant banking licence, according to a Bloomberg report. However, the move does not guarantee approval, as the CBN is yet to make a final decision on the application.
JPMorgan expects to secure the licence by the end of 2026 or early 2027, subject to regulatory approval, Bloomberg said.
The development could mark a significant expansion of the bank’s presence in Nigeria, where it has advised successive governments and major companies on Eurobond issuances and other financial transactions, largely operating through its Lagos representative office.
Under the CBN’s banking recapitalisation framework, nationally authorised merchant banks are required to maintain minimum paid-up capital of N50 billion. JPMorgan’s deposit indicates that it is preparing to enter Nigeria’s wholesale banking market rather than establish a full commercial banking operation.
A merchant banking licence would enable the bank to broaden its activities beyond financial advisory services, potentially extending into corporate finance, treasury services, capital markets transactions and other wholesale banking activities, depending on the scope of regulatory approval.
JPMorgan’s entry could provide large Nigerian companies with additional access to international financing, structured financial products and global investors. Its established relationships with international capital markets could also strengthen financing options for businesses seeking to raise funds abroad.
The bank has played a significant advisory role in Nigerian sovereign and corporate Eurobond transactions over the years. A locally licensed operation would give it a more direct presence in the domestic financial market and potentially expand its ability to serve Nigerian businesses and institutions.
The application also comes as JPMorgan strengthens its operations across Africa, targeting opportunities in trade finance, lending, payments and corporate banking.
The bank has recently made several regional appointments, including Edward Bell as head of investment banking in sub-Saharan Africa, Sailepu Montet as head of its Kenya office, and Michael Ahonzo Avou to oversee operations in Côte d’Ivoire.
A Nigerian banking licence would represent a shift from the representative-office model the bank has maintained in Lagos for decades, allowing it to establish a more substantial local platform, subject to the conditions attached to its approval.
For Nigeria’s banking industry, the development could intensify competition in wholesale banking, particularly in services for multinational companies, major domestic businesses, financial institutions and government-related entities.
JPMorgan’s global balance sheet, international distribution network and capital-markets expertise could make it a stronger competitor for large corporate clients and major financing transactions, potentially putting pressure on established Nigerian and international banks operating in the country.
The timing is also significant as Nigeria continues to pursue foreign exchange reforms and efforts to strengthen external balances and restore investor confidence. JPMorgan’s decision to commit the required capital signals its interest in the country’s corporate and capital markets, although currency volatility and other economic risks remain.
JPMorgan declined to comment on the application, while the CBN did not immediately respond to a request for comment, Bloomberg reported.
The next milestone is the regulator’s decision. If the licence is granted, JPMorgan would be positioned to transform its longstanding advisory presence into a locally licensed wholesale banking operation, potentially expanding financing options for Nigerian businesses and strengthening their connections to international capital markets.