Cardoso: Three Years Painstaking Reforms and Stability
By Kabir Abdulsalam,
Three years after Olayemi Cardoso assumed office as Governor of the Central Bank of Nigeria, the country’s monetary authorities are pointing to stronger foreign exchange reserves, a more organised currency market and a recapitalised banking sector as evidence of a changing financial landscape.
But the real measure of the reforms extends beyond the CBN’s balance sheet.
It is whether improved monetary stability can translate into affordable credit, more predictable business costs and greater confidence in the Nigerian economy.
Cardoso took charge of the apex bank in September 2023, at a time when Nigeria faced significant foreign exchange distortions, inflationary pressure and concerns about monetary-policy credibility. His administration subsequently pursued a more market-oriented FX regime, tighter monetary policy and institutional reforms intended to restore confidence in the financial system.
The results have been mixed in their effect on different segments of the economy, but several developments deserve attention.
The most consequential part of the reform programme has been the effort to improve the functioning of Nigeria’s foreign exchange market.
Measures affecting market transparency, authorised dealers, Bureau de Change operations, export proceeds and remittance settlement have been designed to strengthen price discovery and reduce distortions.
The significance of these measures is clear for manufacturers and import-dependent businesses. When companies cannot obtain foreign exchange predictably, planning becomes difficult, production costs rise and investment decisions are delayed.
The CBN’s reported improvement in external reserves provides another measure of the changing environment. During a Senate briefing in July 2026, Cardoso said Nigeria’s reserves had risen to $52.73 billion as of July 9. The CBN has also reported growth in official remittance inflows following reforms to the remittance market.
These developments are relevant to external confidence, but they should not be interpreted as proof that all foreign exchange problems have disappeared. The durability of the gains depends on the quality of inflows, reserve management and the ability of the economy to generate sustainable foreign exchange.
Banking Recapitalisation and the Next Question
The banking sector is another major part of Cardoso’s agenda.
The CBN’s recapitalisation programme, completed in March 2026 according to the supplied institutional timeline, reportedly saw 33 banks meet revised capital requirements, raising approximately ₦4.65 trillion in fresh capital. About 72.55% of the funds were sourced domestically.
The figures represent a substantial strengthening of banks’ capital positions. They also raise an important question: what will the banks do with the additional capacity?
Capital adequacy is essential for financial stability, but stronger balance sheets do not automatically translate into cheaper loans or increased lending to productive businesses.
For a manufacturer seeking to expand production, a farmer looking for seasonal financing or a small enterprise requiring working capital, the practical value of banking reform will ultimately depend on access to finance, pricing and the quality of lending decisions.
The next stage of the banking reform agenda should therefore be assessed not only through capital raised but also through credit growth, asset quality and the ability of banks to support economic activity responsibly.
Inflation and Test of Economic Recovery
Despite improvements reported in certain monetary indicators, inflation remains a crucial measure of how reforms affect Nigerians.
The recent report by National Bureau of Statistics shows that headline inflation rose from 15.06% in February 2026 to 15.93% in May before easing to 15.91% in June. These figures indicate moderation from earlier periods, but they do not mean that prices have returned to previous levels.
This distinction matters. A reduction in the inflation rate means prices are increasing more slowly; it does not necessarily mean that food, transport or household expenses have become cheaper.
The CBN’s monetary tightening and efforts to strengthen policy transmission can influence inflationary pressures, but food supply, energy costs, logistics, fiscal policy and exchange-rate movements also shape the outcome.
Consequently, the governor’s performance should be examined through the interaction between monetary policy and the wider economic environment, rather than by assigning every change in prices to the central bank alone.
The reported rise in external reserves is one of the most visible indicators of the reform period.
The CBN has also highlighted diversification of reserve assets, including the addition of locally sourced gold refined to international standards, according to the supplied timeline. The precise details of the gold holdings, their valuation and accounting treatment should be established from official documentation before publication.
Beyond reserves, the bank’s programme includes changes to financial-market infrastructure, including the reported introduction of the Nigerian Overnight Financing Rate (NOFR) in April 2026.
Such technical reforms may not attract the same public attention as exchange rates, but they influence how financial institutions price liquidity, manage risks and transmit monetary-policy decisions through the financial system.
Their importance lies in improving the reliability of market operations, not simply in announcing new mechanisms.
The CBN’s Payments System Vision 2028, alongside revised agent banking guidelines and measures to strengthen instant-payment security, represents another area of institutional change.
Nigeria’s expansion of digital payments has created opportunities for financial inclusion while also exposing consumers and businesses to electronic fraud, transaction failures and operational risks.
The reported introduction of stronger transaction controls, authentication measures, geo-fencing and connectivity requirements reflects the challenge of maintaining payment reliability as digital transactions expand.
For the average consumer, the value of these reforms will be measured by secure transactions, effective complaint resolution and reduced exposure to fraud. For businesses, it will depend on the reliability of payment channels and the cost of operating within the system.
From Stability to Shared Prosperity
The CBN’s reforms are taking place within a broader economic programme that also requires fiscal discipline, productive investment, infrastructure and stronger coordination among economic institutions.
At a BusinessDay CEO Forum in July 2026, Cardoso and the Coordinating Minister of the Economy, Taiwo Oyedele, discussed the need to translate macroeconomic stability into investment, productivity and job creation.
That transition is the most important test of the reform programme.
A more stable foreign exchange market can improve planning. Stronger banks can support financing. Improved reserves can strengthen external buffers. Better payment infrastructure can support commerce. But these benefits must reach the productive economy to have a lasting impact on livelihoods.
Cardoso’s third anniversary is therefore an opportunity to examine both the massive progress recorded and the work that remains. The CBN’s institutional reforms have altered important parts of Nigeria’s financial architecture, while inflation, credit access and the cost of doing business remain central concerns.
The next phase will require sustaining the gains, strengthening policy credibility and ensuring that financial stability supports broader economic opportunity.
The achievement of stability is significant. Its lasting value will depend on what Nigeria’s businesses and households are able to build on it.
Kabir Abdulsalam writes in via: [email protected]