In September 2026, Olayemi Cardoso — nominated by President Bola Tinubu on September 15, 2023, assumed office in acting capacity on September 22 and confirmed by the Senate on September 23, with formal tenure commencing October 5, 2023 — completed three years as Governor of the Central Bank of Nigeria not as a caretaker, but as a man who fought battles on three fronts and rewrote the rules of the game.
That choice to rewrite the rules becomes clear only when you see what he inherited. He met the fallout of controls — multiple exchange rates, a $7 billion trapped FX backlog, broken transmission and depleted credibility — and chose markets over management, transparency over allocation, and price over patronage. It is that shift from rationing scarcity to pricing it that earned him the Central Bank of the Year award by Central Banking, London, and commendation from President Tinubu, but the real measure lies in what he dismantled and what he built in its place.
To understand what he had to reset, you have to return to what the control model was designed to achieve. When Godwin Emefiele took office, his mandate was the classic triad of monetary and price stability, financial system stability and development finance. Within months that mandate was overwhelmed by oil collapsing to $30 per barrel, reserves falling, the naira plunging above N365 per dollar in the parallel market in August 2017, and five consecutive quarters of contraction.
The response was administrative scarcity management. The CBN created NAFEX for investors and exporters in 2017, NIFEX for weekly bank auctions, restricted 41 items from accessing official dollars, and pumped roughly $20 billion into the market between 2016 and 2018 to defend an official rate around N305 per dollar. It worked as a survival strategy because oil recovered to $80 by 2018, allowing reserves to rise from $30.36 billion in May 2017 to $47.4 billion a year later, inflation to fall from 16.25 percent to 12.48 percent while MPR was held at 14 percent from July 2016, and no systemic bank failed during recession.
The cost was that stability was bought, not built. The IMF warned that multiple rates created arbitrage and discouraged investment, net portfolio investment fell to -$1.704 billion in 2016 as investors could not repatriate funds and could not read policy direction, and unemployment rose to 18.8 percent in Q3 2017 from 16.2 percent in Q2.
Emefiele solved the exchange rate at the expense of transparency and inflation at the expense of jobs. By 2023 the bill had grown larger. Multiple windows had become entrenched arbitrage centers, a $7 billion FX backlog had accumulated, correspondent banking lines had thinned, Ways and Means financing had breached legal limits, and quasi-fiscal programs like Anchor Borrowers had blurred monetary and fiscal lines. Broad money had ballooned, transmission was broken, and markets waited for circulars, not communiques.
Cardoso’s first and most defining battle was therefore on the exchange rate, and it was fought as a deliberate reversal. In year one all FX windows were collapsed into one market price and the $7 billion backlog to airlines, manufacturers and portfolio investors was verified and cleared. The logic was simple and unforgiving. You cannot have price stability if you have five prices for the same dollar, and no investor brings fresh dollars when old dollars are trapped.
Unification ended round-tripping and restored price discovery, even though it meant sharp depreciation in the short term. Backlog clearance reopened correspondent lines and signaled that contracts would be honored. That credibility became the foundation for everything that followed.
What followed in the last twelve months shows how far that liberalisation has been institutionalised. On May 15, 2026 the fourth edition of the Foreign Exchange Manual was launched to codify transparency and market-driven operations. BDC market reforms in 2026 gave licensed BDCs structured access to FX through authorised dealer banks, supported by an FX BDC Purchase Tracker that allows real-time oversight rather than outright bans.
On March 25, 2026 international oil companies were permitted to repatriate 100 percent of export proceeds through authorised dealer banks, reversing years of forced retention. On March 24, 2026 new naira-settlement requirements for International Money Transfer Operators were introduced to improve traceability of remittance flows, and in 2026 additional crude-oil export terminals were allocated to strengthen monitoring across the oil and gas value chain. Where Emefiele spent an estimated $20 billion to defend a rate funded by $80 oil, Cardoso has spent credibility to let the rate find its level and then rebuilt the plumbing so that portfolio inflows and remittances, not CBN intervention, now underpin reserves.
The second battle has been over the banking system itself, and here the contrast is between forbearance and capital. Emefiele maintained financial stability by ensuring no bank failed during recession, using forbearance and regulatory flexibility, but left banks thinly capitalised for an economy where the naira moved from N305 to over N1,300 and broad money hit N139.38 trillion.
Cardoso chose to rebuild buffers from the ground up. On March 31, 2026 banking recapitalisation was completed, with 33 banks meeting revised minimum capital requirements and raising approximately N4.65 trillion in fresh capital, about 72.55 percent of which was sourced domestically. That matters because domestic capital is more stable and signals local confidence, and because stronger capital allows banks to absorb FX revaluation losses and meet single obligor limits.
He paired capital with governance. In September 2025 new requirements for orderly succession of CEOs of Domestic Systemically Important Banks were introduced, closing a governance gap where sudden leadership vacuums had previously created systemic anxiety. In February 2026 the CBN approved the Bank of Industry’s Non-Interest Banking Window, expanding inclusive financing without putting quasi-fiscal lending back on the CBN balance sheet.
The market response has been visible on the Nigerian Exchange where First HoldCo hit N160 and Otedola’s stake crossed N2 trillion in value, and GTCO, Zenith and Stanbic rallied to push market capitalisation above N160 trillion and the All-Share Index to 249,804. That rally is not a bubble alone, it is a forward pricing of banks that can finally intermediate. Yet it also exposes execution risk, because banks can meet capital thresholds by retaining earnings from high-yield government paper at 22.24 percent overnight rather than expanding productive credit, which would leave consumer names like Cadbury at N53 and power names like Transpower below their 52-week lows.
The third battle has been fought in the payments and consumer protection space, where Emefiele’s legacy was restrictive cash policies and ad-hoc limits that pushed agents and PoS operators into grey areas. Cardoso has moved from controlling cash to architecting trust.
On September 9, 2025 the PSV 2028 Project Committee was inaugurated and on June 1, 2026 the Payments System Vision 2028 was launched, a roadmap anchored on interoperability, security, inclusion, innovation, trust and collaboration. On October 6, 2025 revised agent banking guidelines introduced stronger consumer protection, agent oversight, transaction controls and geo-location requirements with sanctions.
In 2026 PoS geo-fencing and dual connectivity measures were introduced to improve traceability, resilience and reliability of transactions. On July 1, 2026 enhanced instant-payment security gave customers greater control over payment preferences and transaction limits alongside stronger device authentication, identity verification and real-time fraud monitoring.
This was reinforced by a consumer protection and cybersecurity stack that the previous framework lacked. On December 2, 2025 revised cash policy introduced new withdrawal thresholds while removing restrictions and charges on cash deposits to support efficient cash management without punishing savers. In November 2025 financial institutions were directed to withdraw misleading or non-compliant advertisements.
In 2026 banks were directed to strengthen rapid-response mechanisms for electronic fraud with emphasis on reducing intervention time. On March 12, 2026 the BVN and watchlist framework was strengthened, on March 30, 2026 a Cybersecurity Self-Assessment Tool was deployed for regulated institutions, and on March 10, 2026 automated AML/CFT/CPF standards were introduced for real-time detection of financial crime. Together these moves shift financial stability from forbearance to technology-enabled supervision.
The fourth front is the most technical but arguably the most important for monetary transmission, which was broken by 2023 after years of fiscal dominance. Emefiele held MPR at 14 percent while running expansionary quasi-fiscal operations, flooding the system and making MPC signals irrelevant. Cardoso raised MPR repeatedly to 26.5 percent over three years and mopped up liquidity aggressively through OMO and CRR, choosing to tighten both price and quantity of money.
He also cut back direct development finance and returned it to banks and fiscal authorities. He restored communication, replacing surprise circulars with regular MPC statements, data releases and forward guidance, on the bet that predictable rules, even if tough, reduce the uncertainty premium that drives speculation and widens the parallel premium.
To make tightening transmit, he rebuilt market infrastructure. On April 17, 2026 the Nigerian Overnight Financing Rate was introduced, a transaction-based overnight benchmark to improve price discovery, transparency and risk management, directly addressing the broken transmission that made broad money growth unreliable. Between 2025 and 2026 fixed-income market reform moved the CBN to strengthen direct oversight of trading and settlement infrastructure, and in 2026 discount window and liquidity market reforms reviewed access and operational arrangements.
The result has shown up in external buffers. In 2026 locally sourced gold refined to LBMA Good Delivery standards was added to reserves for diversification, and external reserves surpassed $50 billion, the highest in approximately 17 years. The $47.4 billion peak of May 2018 was built on $80 oil and $20 billion of intervention. The $50 billion of 2026 is built on unified pricing, backlog clearance, remittance reform and export monitoring.
Yet three years in, the limits of what a central bank can do alone are stark, and this is where Dr. Suleyman Ndanusa’s coordination critique bites. The CBN can target price stability, but inflation in Nigeria has several institutional addresses. Food prices that drive headline inflation are shaped by insecurity on farms, transport costs and energy costs that do not respond to MPR.
Broad money at N139.38 trillion, up 16.4 percent year-on-year, with Net Domestic Assets up N925 billion in a month while Net Foreign Assets fell, shows that fiscal cash releases and domestic borrowing are injecting liquidity even as the CBN tries to mop it. FAAC distributions, bond auctions and capital releases often surprise liquidity forecasts, and heavy domestic borrowing crowds out private credit as banks prefer risk-free government yields to lending to manufacturers.
On recapitalisation, supervision must ensure new capital is real and not financed by insider loans or foreign borrowing that creates new vulnerabilities. It must also ensure capital translates into productive credit rather than just higher holdings of government securities, otherwise the weak performance of the real economy will persist.
In sum, Emefiele’s 2016-2019 era was about surviving a recession with controls funded by recovering oil, buying temporary exchange rate stability at the cost of transparency, market depth and future credibility. Cardoso’s 2023-2026 era has been about buying credibility by letting the market price the naira, paying old debts, tightening money, forcing banks to recapitalise, building payment rails, hardening fraud defenses and creating a credible overnight benchmark.
The former spent reserves to ward off speculators, the latter has spent three years inviting investors back by honouring contracts and publishing rules. Whether that rule-based stability translates into lower inflation, stable public finance, resilient FX and productive credit will depend less on the CBN’s resolve and more on whether fiscal authorities, the DMO, Budget Office, Accountant-General, NBS, sector ministries and states align their actions to reinforce, not contradict, the tight monetary stance. The central bank can protect the value of money, but it cannot grow food, fix roads or generate power.
