JPMorgan has secured preliminary approval from the Central Bank of Nigeria to establish a merchant bank, advancing its plans to expand its banking operations in the country.

The proposed institution, JPMorgan Merchant Bank Nigeria Limited, must still obtain a final licence before it can commence business, the CBN said in a statement on Friday.

The decision follows recent reports that the U.S. banking group deposited N50 billion with the regulator as part of its application for a merchant banking licence.

Premium Times, citing Bloomberg, reported earlier this week that JPMorgan was seeking approval by the end of 2026 or early 2027, subject to meeting regulatory requirements. The approval-in-principle represents progress in that process but does not authorise operations. 

CBN spokesperson Michael Akuka said the proposed bank must complete incorporation with the Corporate Affairs Commission and satisfy the remaining operational and regulatory requirements before receiving final authorisation.

The regulator also approved the nomination of Adedapo Adedayo Olagunju as managing director.

JPMorgan currently maintains a representative office in Lagos. Earlier this month, its West Africa managing director, Dapo Olagunju, disclosed plans for a Nigerian merchant banking subsidiary during the Nigeria-Asia Financial Connectivity Dialogue in Singapore.

JPMorgan’s history in Nigeria stretches back decades. According to its official corporate history, its predecessor, Chase Manhattan Bank, opened a Lagos branch in 1961 and a representative office in Nigeria in 1982.

The CBN approved Latter Kevin George, Nzelu Chinedum Izunwanne and Syed Gabriel Murtaza as non-executive directors.

Alade Sarah Omotunde, Ajayi Olukonyinsola and Adetu Seni were approved as independent non-executive directors.

The approval comes after Nigeria’s banking recapitalisation programme. Under the requirements introduced in March 2024, the minimum capital for merchant banks increased from N15 billion to N50 billion. 

The CBN described JPMorgan’s proposed expansion as evidence of growing international interest in Nigeria’s financial markets. 

CBN Governor Olayemi Cardoso said the regulator’s objective was to strengthen financial stability and connections with international markets.

“Our objective is to build a financial system that is stable, competitive and internationally connected, one that commands confidence and can effectively support investment and economic growth.

“We are encouraged by the growing interest of international financial institutions in Nigeria. Our focus remains on sustaining the reforms, strengthening the credibility of our markets and creating an environment in which both domestic and international institutions can participate and thrive,” he said.