Nigeria’s central bank defends 75% reserve requirement
By the AFREEQUE newsroom, based on Punch
Nigeria’s central bank is defending a mandatory 75% reserve on public deposits outside the Treasury Single Account. The measure aims to reduce excess liquidity and inflationary pressures while limiting funds available for lending, according to central bank official Hakama Sidi-Ali, quoted by Punch.
The Central Bank of Nigeria (CBN) is defending the application of a 75% cash reserve ratio on public-sector deposits not covered by the Treasury Single Account. Hakama Sidi-Ali, director of the CBN department responsible for stakeholder and institutional relations, presented the measure on Thursday during the CBN Listens programme in Ibadan, according to Punch.
The ratio requires banks to keep 75% of the relevant deposits with the central bank instead of using them to issue loans or finance other activities. The CBN says it aims to limit excess liquidity in the banking system and contain inflationary pressures, according to Punch.
The measure was introduced at the 302nd meeting of the Monetary Policy Committee, held on 22 and 23 September 2025. Hakama Sidi-Ali also cited the unification of exchange rates, the Bloomberg BMatch platform and the recapitalisation of banks among the reforms undertaken under Governor Olayemi Cardoso to strengthen macroeconomic stability and financial markets, according to the same outlet.
