On 5 February 1929, a syndicate of Lagos businessmen led by Dr Akinola Maja, Henry Adeola Subair and the Egba lawyer Adeyemo Alakija registered the Industrial and Commercial Bank Ltd — the first bank in Nigeria owned by Nigerians. It opened on Tinubu Square with a paid-up capital of £4,000 and a promise to lend to African traders the expatriate banks would not touch. It lasted seventeen months. The Great Depression and a single bad loan to a Lagos textile importer broke its reserves, and it was wound up in 1930.
That failure set the pattern. Between 1929 and 1952, twenty-five indigenous banks were registered; twenty-one collapsed. The roll-call is its own elegy: Nigerian Mercantile Bank (1931, failed 1936); Nigerian Penny Bank (1940, failed 1941); Pan-Nigerian Bank (1951, failed 1954); Standard Bank of Nigeria — no relation to the British one — (1951, failed 1954). Most opened with paid-up capital under £10,000, no clearing rights, no banking inspectors and no deposit insurance. A run on the cashier's drawer was enough.
Three survived the cull and built the spine of modern Nigerian banking. The National Bank of Nigeria, founded on 11 February 1933 by Akinola Maja, T.A. Doherty and H.A. Subair with backing from the Western Region, opened a branch network across Yorubaland and lasted until its absorption into Wema in 2002. Agbonmagbe Bank, founded by Chief Matthew Okupe in 1945 in Agbonmagbe (later Ijebu-Ode), was acquired by the Western Region in 1969 and renamed Wema Bank — still trading today. And African Continental Bank (ACB), taken over by Nnamdi Azikiwe's Zik Group in 1947 and shifted to the Eastern Region's books in 1956, became the political treasury of the NCNC and survived (battered) into the 2005 consolidation as Spring Bank.
The carnage triggered the Paton Inquiry of 1948 — G.D. Paton, a Bank of England official seconded to the Colonial Office, found 'a complete absence of any system of banking regulation' and recommended a Banking Ordinance, minimum capital requirements, and the creation of a Central Bank. The Ordinance came in 1952 (£12,500 minimum capital for indigenous banks, £200,000 for expatriate); the CBN followed in 1959. By the time the rules existed, the boom-and-bust had already taught Nigerian depositors a lesson that took two generations to unlearn: that an indigenous bank was where you went to lose your money.
Figure 1
Licensed Nigerian banks, 1894–2024
Every regulatory cycle since 1952 has compressed the field. The 2005 Soludo consolidation cut ninety banks to twenty-five in eighteen months.
Figure 2
Minimum paid-up capital required to operate a bank, 1952–2024 (₦ million, log scale)
The regulatory bar has risen by seven orders of magnitude. Each step up has reset who is allowed to call themselves a Nigerian bank.