America’s biggest bank JPMorgan moves to launch operations in Nigeria

JPMorgan Chase & Co. has deposited ₦50 billion ($38 million) with the Central Bank of Nigeria (CBN), bringing the US lender closer to securing a licence to operate a merchant bank in the country, Bloomberg reported on Tuesday.

The deposit is one of the final regulatory requirements for the licence, according to people familiar with the application who spoke to Bloomberg on condition of anonymity because the process is private.

The lender expects to obtain approval by the end of 2026 or early 2027, the people said. However, the application remains subject to the CBN’s final decision, and approval is not guaranteed.

JPMorgan declined to comment, while a CBN spokesperson did not immediately respond to a request for comment.

Under Nigerian banking regulations, applicants are required to deposit capital in a designated account with the central bank as part of the licensing process. The requirement helps demonstrate that an applicant has funds available to support its proposed operations.

What a merchant bank does

Unlike a conventional commercial bank, which provides everyday banking services such as savings accounts, deposits and payments, a merchant bank focuses primarily on businesses, large corporations and institutional clients. Ordinary people can’t walk into a merchant bank to open a savings account, collect a salary or use an ATM.

Its services can include arranging financing for companies, helping businesses raise capital, advising on mergers and acquisitions, and providing trade finance to support imports, exports and other commercial transactions. Depending on its regulatory authorisation, a merchant bank may also provide corporate lending and other specialised financial services.

For Nigerian businesses, JPMorgan’s proposed entry could widen access to international financing, trade-related services and financial expertise, particularly for large companies involved in cross-border commerce.

The actual benefits, however, will depend on the services the bank is authorised to provide, the clients it targets and the terms on which it offers financing.

JPMorgan expands its African ambitions

The proposed licence would allow JPMorgan to expand beyond its existing representative office in Lagos, Nigeria’s commercial capital. A representative office typically supports relationship-building, market research and liaison activities but cannot conduct the full range of banking business permitted under a banking licence.

The move forms part of the New York-based lender’s broader push to grow its business across Africa, including trade finance, payments, lending and corporate banking.

JPMorgan has also strengthened its investment-banking team in the region in recent months. It appointed Edward Bell to lead investment banking in sub-Saharan Africa, Sailepu Montet to head its Kenya office, and Michael Ahonzo Avou to oversee operations in Côte d’Ivoire.

A Nigerian licence would give the lender a more substantial local presence in Africa’s most populous country and one of the continent’s largest economies. Whether that translates into significant new financing for Nigerian businesses will become clearer if the application is approved and the bank begins operations.