The Central Bank of Nigeria (CBN) has instructed banks to deny certain banking services and additional credit facilities to large borrowers with non-performing loans, in a bid to strengthen credit discipline within the banking sector.
The directive, contained in a letter dated March 12, 2026 and signed by the Director of Banking Supervision, Olubukola Akinwunmi, targets borrowers whose loans are classified as non-performing and recorded in the Credit Risk Management System (CRMS) or by licensed private credit bureaus. These borrowers will no longer be eligible for new credit from banks.
The CBN stated that the measure aims to reduce risks posed by large borrowers whose defaults could destabilize the financial system.
“Effective immediately, all financial institutions shall restrict further credit access to any large-ticket obligor with a non-performing facility recorded in the CRMS or any licensed private credit bureau. Such restrictions cover loans and other forms of direct credit, as well as banking facilities or contingent liabilities, including letters of credit, performance bonds, bankers’ confirmations, and advance payment guarantees,” the bank said.
The restrictions specifically apply to large-ticket obligors, defined under prudential guidelines as individuals or companies whose combined exposure across banks exceeds the Single Obligor Limit or whose financial obligations could significantly affect a bank’s capital adequacy ratio.
Additionally, banks have been directed to obtain extra realizable collateral from affected borrowers to secure existing loan exposures. The determination of such borrowers will rely on data from the CRMS and licensed private credit bureaus.
This directive reinforces an earlier circular issued in June 2024, which barred loan defaulters from accessing new credit facilities. The move comes amid growing concerns over rising bad loans in the Nigerian banking sector.