The Central Bank of Nigeria (CBN) has granted American financial giant JPMorgan approval-in-principle to establish a merchant bank in Nigeria following a reported $38 million capital deposit.
The proposed financial institution, to be known as JPMorgan Merchant Bank Nigeria Limited, represents a significant step in the bank’s plans to expand its presence in Africa’s largest economy.
The CBN announced the preliminary approval in a statement on Friday, October 23, 2026.
However, the apex bank clarified that the approval-in-principle does not constitute a final banking licence. JPMorgan must satisfy the remaining regulatory requirements before it can commence operations.
JPMorgan Deposits $38 Million
The development follows reports earlier this week that JPMorgan Chase & Co. deposited ₦50 billion, equivalent to approximately $38 million, with the CBN as part of its application for a merchant banking licence.
The deposit meets a key capital requirement for a nationally licensed merchant bank in Nigeria.
The move brought the American lender closer to establishing a locally licensed banking operation, although the final decision remained with the regulator at the time of the initial reports.
CBN Sets Conditions Before Operations Begin
According to the CBN, JPMorgan Merchant Bank Nigeria Limited must fulfil all applicable regulatory requirements, including incorporation with the Corporate Affairs Commission and the completion of the necessary operational arrangements.
The bank can commence business only after the CBN issues its final licence.
The apex bank said the approval aligns with efforts to strengthen financial stability, deepen Nigeria’s financial markets and attract international investment.
The development also follows the banking sector recapitalisation exercise, which the regulator says has strengthened the resilience and capacity of Nigeria’s banking industry.
Proposed Management and Board Approved
As part of the approval process, the CBN approved Adedapo Adedayo Olagunju as the proposed managing director of the new institution.
The regulator also approved nominations for non-executive and independent non-executive directors as part of the bank’s proposed governance structure.
What JPMorgan’s Entry Could Mean for Nigeria
A fully licensed JPMorgan merchant bank could expand financing options for major Nigerian companies, multinational businesses and other institutional clients.
Merchant banks generally specialise in wholesale financial services, including corporate finance, capital markets transactions and advisory services.
JPMorgan already has a representative office in Lagos and has advised Nigerian governments and companies on international financial transactions.
A locally licensed operation could allow the lender to expand its participation in Nigeria’s corporate and investment banking market, although the actual scope of its services will depend on the final licence granted by the CBN.
The proposed entry also comes as Nigerian authorities seek to deepen capital markets, improve investor confidence and strengthen the country’s connections with international financial institutions.
For now, JPMorgan has secured preliminary regulatory approval, but it must obtain a final licence before beginning merchant banking operations in Nigeria.
