CBN Mandates Early CEO Approvals for Systemically Important Banks to Strengthen Governance and Stability

The Central Bank of Nigeria (CBN) has introduced a landmark directive aimed at fortifying governance and stability in the country’s banking sector. Under the new rules, all Domestic Systemically Important Banks (DSIBs), often referred to as “too big to fail” must secure regulatory approval for the appointment of new chief executives at least six months before an incumbent exits. In addition, these appointments must be publicly announced no later than three months before the leadership transition, ensuring transparency and minimizing market uncertainty.

DSIBs hold vast deposits, extend credit across sectors, and maintain crucial links with Nigeria’s broader financial system. Any instability, whether real or perceived, could trigger market panic, investor flight, or erosion of public trust. By mandating early approvals and public disclosure, the CBN is closing a long-standing gap where leadership transitions were sometimes rushed, politicized, or opaque—leaving banks vulnerable to rumors and operational disruptions

The urgency of the move is underscored by past events, such as the sudden death of Access Holdings’ CEO Herbert Wigwe in 2024, which rattled the entire banking industry despite swift internal measures. Globally, countries like the U.K., U.S., and South Africa have long integrated formal succession planning into their regulatory frameworks. By aligning with these international best practices, Nigeria signals its commitment to corporate governance, leadership continuity, and systemic resilience.

For Nigerian banks, the directive necessitates deeper investment in talent management, ensuring potential leaders are groomed years in advance. Boards can no longer rely on quick fixes when a CEO exits, while transparency in appointments fosters confidence among shareholders, employees, and customers. For investors, both domestic and foreign, the measure enhances predictability and signals that Nigeria’s financial sector is actively safeguarding stability.

The policy also reinforces Governor Olayemi Cardoso’s broader reform agenda, which emphasizes governance, transparency, and resilience. Beyond individual banks, succession planning strengthens the wider economy by attracting investment, protecting depositors, and improving Nigeria’s credibility in global financial markets. By making leadership continuity a matter of policy rather than chance, the CBN is ensuring that the country’s most influential banks remain pillars of stability amid global and domestic uncertainties.

source: leadership