E-Financial
New Rules to Ban Bailout for ‘Too Big to Fail’ Banks
New global rules to prevent banks that are “too big to fail” from being bailed out by taxpayers have been proposed, according to BBC.
The rules, created by the Financial Stability Board (FSB), a global regulator, will require big banks to hold much more money against losses. Mark Carney, FSB chairman and governor of the Bank of England, said the plans were a “watershed” moment.
BBC quoted him as saying that it had been “totally unfair” for taxpayers to bail out banks after the financial crisis of 2008 and 2009.
“The banks and their shareholders and their creditors got the benefit when things went well,” he told the BBC.
“But when they went wrong the British public and subsequent generations picked up the bill – and that’s going to end”.
Mr Carney explained that the new system would ensure that bank shareholders, and lenders to banks such as bondholders, would become first in line to bear the brunt of future losses if banks could not pay out of their own resources.
“Instead of having the public, governments, [and] the taxpayer rescue banks when things go wrong; the creditors of banks, the big institutions that hold the banks’ debt – not the depositors – will become the new shareholders of banks if banks make mistakes.”
“Let’s face it, the system we’ve had up until now has been totally unfair,” he added.
At its peak in the UK alone, taxpayers’ direct subsidy to banks stood at more than £1 trillion according to a recent report from the National Audit Office.
In the wake of the financial crisis, world leaders asked the FSB to come up with proposals to prevent similar bailouts from happening in the future.
The proposed new rules, which are up for consultation and should take effect in 2019, require “global systemically important banks” to hold a minimum amount of cash to ensure they will be able to survive big losses without turning to governments for help.
The capital set aside should be worth 15-20% of the bank’s assets, the FSB said. That is a far bigger cushion against losses than is required by current banking rules.
RBS sign The UK government still owns an 80% stake in Royal Bank of Scotland
The FSB hopes this stronger policy will prevent taxpayers from being forced to pay billions of pounds again to stop big banks from collapsing, in the event of another financial crisis.
Anthony Browne of the British Bankers’ Association welcomed the proposals.
“The banking industry strongly supports this work, which is a really important step in ending ‘too big to fail’ and ensuring that never again will taxpayers have to step in to bail out banks,” he said.
“We agree with the aims and objectives of the proposals for total loss absorbing capacity (‘TLAC’), that there should be sufficient resources available to absorb losses in the event of bank failure and provide new capital to ensure critical economic functions can continue to be provided,” he added.
Less disruption
“Agreement on proposals for a common international standard on total loss-absorbing capacity for [big banks] is a watershed in ending ‘too big to fail’ for banks,” said Mr Carney.
“Once implemented, these agreements will play important roles in enabling globally systemic banks to be resolved without recourse to public subsidy and without disruption to the wider financial system.”
According to the BBC’s business editor Kamal Ahmed, analysts estimate the new capital requirements could cost €200bn (£157bn) for Europe’s banks alone, with the cost for globally significant banks in the US, Japan and China likely to be much higher.
The FSB has published a list of 30 banks it regards as “systemically important”, meaning their collapse could have a wider impact on global financial systems.
In the UK, the banks are Barclays, Standard Chartered, HSBC and the Royal Bank of Scotland.
Lloyds Banking Group has been removed from the list as its potential impact on financial systems has declined in recent years.
The UK government spent around £65bn directly bailing out RBS and Lloyds during the crisis. The government still owns an 80% stake in RBS and 25% of Lloyds.
Analysis: Andrew Walker, economics correspondent, BBC News.
Lehman Brothers was the classic case of a financial institution that was too big to fail – or at least it probably was according to the previous Federal Reserve chairman Ben Bernanke.
Of course it DID fail, and the financial crisis entered a new and more dangerous phase after Lehman filed for bankruptcy in September 2008. The immediate lesson that many policy makers drew – and this is contested – was that it should have been rescued.
And so they decided that other big financial firms would not fail and taxpayers’ money was thrown at the banks around the world.
But there is another lesson drawn from the Lehman episode: that it would be far better to change the rules of finance to ensure that any bank could safely fail if it gets into serious difficulty no matter how big it is.
That’s where the Financial Stability Board’s new proposals come in.
Nigeria’s Bank Verification Number (BVN) database expanded to 69.55 million as of July 5 2026 from 69.32 million in June 2026, according to latest data released by the Nigeria Inter-Bank Settlement System (NIBSS).
BVN is an 11-digit biometric identification system introduced by the Central Bank of Nigeria and managed by the Nigeria Inter-Bank Settlement System (NIBSS) to secure customer accounts and reduce fraud.
This means that BVN enrolments increased by 228,947 between June and July 5 this year.
With the BVN database standing at 67.8 million as of December 31, 2025, it also means that the database grew by 1.75 million between the end of last year and July 5, 2026.
Specifically, with less than 1.8 million BVN enrolments so far recorded for this year, it is looking highly unlikely that BVN registrations at the end of 2026 will come close to the 4.3 million total registrations recorded in 2025.
Analysts note that while the expansion in the BVN database last year was largely driven by the introduction of the NonResident Bank Verification Number (NRBVN) initiative, which enables Nigerians in the diaspora to do their BVN enrolment remotely, thereby removing physical barriers and boosting cross-border financial engagement, the Central Bank of Nigeria (CBN) in March this year, announced a revised BVN regulatory framework, that saw it introducing stricter controls on suspected fraudulent transactions, BVN enrollment, and data access within the banking system.
According to the regulator, the amendments to the BVN framework, which came into effect on May 1, 2026, were aimed at strengthening fraud monitoring, improving identity management within the financial system and safeguarding the integrity of banking transactions, by strengthening identity verification and ensuring that BVN registration aligns with legally recognised age thresholds.
Thus, under the revised BVN framework, the apex bank introduced a stricter age requirement for BVN enrolment, limiting registration to 18-year-old individuals and above.
Also, under the new framework, customers will only be allowed to change the phone number associated with their BVN once. The CBN further stated: “Under the new guidelines, financial institutions are required to establish and maintain a temporary watch-list for BVNs linked to suspected fraudulent transactions reported within the banking system.
“A BVN may remain on this temporary Watch-list for a maximum period of twentyfour (24) hours, during which the BVN owner shall be contacted to provide clarification regarding the identified transaction(s).”
Launched on February 14, 2014, by the CBN in collaboration with the Bankers’ Committee, the NIBSS, and the German firm Dermalog, the BVN scheme was designed to capture the biometrics of all bank customers and provide each with a unique 11-digit identification number that can be verified across the Nigerian banking industry.
Central Bank of Nigeria (CBN) has reaffirmed that the standard N100 banknote remains legal tender across the country, warning that its rejection by individuals, businesses and institutions violates the law.
The clarification follows reports that some members of the public have refused to accept the standard N100 note over concerns about its legal tender status following the introduction of the commemorative N100 banknote issued to mark Nigeria’s centenary.
In a statement signed by Mrs. Hakama Sidi-Ali, acting director of Corporate Communications, the apex bank stressed that “both the commemorative N100 banknote and the standard N100 banknote are valid legal tender and must be accepted for all transactions nationwide.”
The CBN explained that the commemorative N100 note was introduced to celebrate Nigeria’s centenary and did not replace the existing standard N100 banknote.
The CBN cautioned individuals, businesses, financial institutions and other economic agents against rejecting the standard N100 note, noting that such action contravenes the provisions of the CBN Act and undermines public confidence in the national currency.
It warned that appropriate enforcement measures would be taken against any person or organisation found violating the law.
The apex bank reaffirmed its commitment to protecting the integrity of the naira, maintaining confidence in all duly issued banknotes and ensuring the smooth circulation of currency across the country.
The CBN also urged members of the public to continue accepting and transacting with all banknotes legally issued by the Bank and advised anyone seeking further clarification to use its official communication channels.
FCMB Asset Management Limited (FCMBAM), the asset management arm of FCMB Group Plc, has received an upgrade to its national scale long-term and short-term issuer ratings of A(NG) and A1(NG), from A-(NG) and A2(NG), by GCR Ratings, a leading pan-African credit rating agency.
The outlook on the ratings remains stable, said the rating agency.
The upgrade is anchored on FCMBAM’s competitive resilience and financial discipline, alongside the strengthened credit profile of FCMB Group.
GCR highlighted FCMBAM’s decade-long track record of strong performance, well-established brand franchise, diversified product suite and robust distribution network as key drivers of its standalone strength.
These are further supported by consistent earnings growth and a disciplined, unleveraged balance sheet, it said.
According to GCR, FCMBAM’s competitive position is supported by “its relatively long track record, strong brand franchise, established product and geographical distribution network and cross-selling opportunities,” with the rating agency noting that FCMBAM ranks among the top five asset managers in Nigeria, with an estimated five per cent share of a fragmented market as of 31 December.
The Company’s financial performance underpinned the upgrade, with revenue growing by 30 per cent and operating cash flow increasing by 13 per cent, enabling the business to be fully funded without recourse to debt.
Liquidity strengthened further, with liquidity sources versus uses improving to 5x as of December 2025, from 3.6x a year earlier, while the EBITDA margin edged up to over 58 per cent.
Commenting on the upgrade, the Chief Executive Officer of FCMB Asset Management, James Ilori, said: “This upgrade is an important external validation of a strategy we have pursued with discipline over many years: building an investment franchise that performs reliably, governs itself rigorously, and earns trust in every market cycle. It speaks to the strength of our membership of FCMB Group and to a culture that holds itself to local and global standards of risk management and capital stewardship.
“As Nigeria’s asset management industry enters a new era of higher capital thresholds and rising investor expectations, we intend to lead from the front – ahead of regulatory timelines, ahead in digital transformation and ahead in the outcomes we deliver for the clients who trust us to assist them in achieving their investment objectives.”
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