The Central Bank of Nigeria (CBN) has been named Central Bank of the Year by Central Banking magazine, in recognition of sweeping reforms credited with restoring macroeconomic stability and boosting investor confidence in Nigeria. The award highlights what the publication described as a "return to policy orthodoxy" under the leadership of CBN Governor, Olayemi Cardoso, whose team has driven efforts to stabilise the economy following years of policy distortions and market uncertainty.
According to the magazine, Nigeria’s economy had been in a fragile state prior to the reforms, marked by rising inflation, a sharply weakened naira, dwindling foreign exchange reserves and declining investor confidence.
The situation was worsened by the existence of multiple exchange rate windows, a foreign exchange backlog estimated at $7 billion, and heavy dependence on monetary financing.
However, since assuming office in October 2023, Cardoso and his team have rolled out a series of reforms focused on tightening monetary policy, restoring transparency and rebuilding institutional credibility.
A major component of the reforms was the overhaul of the foreign exchange market, including the adoption of a willing-buyer, willing-seller framework and the introduction of an electronic FX matching system.
These measures helped eliminate distortions and significantly reduced the gap between official and parallel market exchange rates from over 60 per cent to less than two per cent.
The publication noted that the CBN also cleared outstanding FX obligations, a move that restored confidence among investors and businesses while improving market liquidity.
In addition, the apex bank implemented aggressive monetary tightening to curb inflation, raising interest rates sharply before cautiously easing them as price pressures began to moderate.
Inflation, which had peaked above 34 per cent in 2024, has since declined to about 15 per cent by early 2026, reflecting improved policy transmission and disciplined liquidity management.
The magazine also highlighted the strengthening of Nigeria’s external reserves, which rose to $46.7 billion by late 2025, the highest level in nearly seven years, providing more than 10 months of import cover.
Beyond monetary measures, the CBN undertook institutional and governance reforms, including ending quasi-fiscal interventions, enhancing regulatory oversight and improving transparency in policy communication.
The bank also launched a recapitalisation programme aimed at strengthening the financial system, with several banks meeting new capital requirements ahead of the March 2026 deadline.
Furthermore, improvements in financial system integrity were cited, including Nigeria’s removal from the Financial Action Task Force grey list and positive assessments from global institutions such as the International Monetary Fund.
Despite the progress, the magazine cautioned that challenges remain, including sustaining disinflation, completing banking sector reforms and strengthening institutional capacity.
Nevertheless, it concluded that the CBN’s actions over the past two years have been "nothing short of remarkable," reflecting a strong commitment to restoring stability and laying the foundation for sustainable economic growth.
