The Central Bank of Nigeria (CBN) has issued new rules requiring Domestic Systemically Important Banks (DSIBs) to secure regulatory approval for successor managing directors at least six months before the incumbent’s exit. Banks must also publicly announce the appointment no later than three months before the transition.
The directive, outlined in a circular signed by CBN’s Director of Financial Policy and Regulation, Dr. Rita Sike, is aimed at strengthening corporate governance, reducing uncertainty, and maintaining confidence in the financial system. It is anchored in the 2023 Corporate Governance Guidelines, which mandate robust succession planning for senior executives across commercial, merchant, non-interest, and payment service banks.
“Each DSIB is hereby required to obtain regulatory approval for the appointment of a successor MD/CEO not later than six months to the expiration of the tenor of the incumbent,” the circular stated, adding that strict compliance is expected.
DSIBs, often described as “too big to fail,” play a critical role in the Nigerian economy due to their size and interconnectedness. The CBN warned that leadership uncertainty at such banks could destabilise both the financial sector and wider economy.
The new policy follows a series of leadership changes in the sector, including Access Holdings Plc’s recent appointment of Innocent Ike as Group Managing Director after CBN approval. It also reflects international best practices, where succession planning is seen as a core element of risk management.
Analysts say the directive will compel banks to build stronger executive pipelines and reduce speculation around leadership changes. While the rules are broadly welcomed, experts note that flexibility may be needed in cases of sudden or unexpected CEO exits.
The measure forms part of Governor Olayemi Cardoso’s broader reforms to improve governance, transparency, and resilience in Nigeria’s financial system.
